* Rare earth mine output quota for 2021 at 168,000 T vs 140,000 T in 2020 * Full-year smelting and separation quota at 162,000 T vs 135,000 T in2020 * Tight heavy rare earth supply to persist while Myanmar border shut-analyst (Adds analyst comment) By Tom Daly Sept 30 (Reuters) - China hiked its annual rare earth output quotas onThursday by 20% year-on-year to their highest levels on record, as it seeksto ease tight supply for manufacturers. A statement from the Ministry of Industry and Information Technology saidthe 2021 rare earth mining output had been set at 168,000 tonnes, up from140,000 last year. The quota for smelting and separation - or processing of rare earths intoa form that can be used by manufacturers - is 162,000 tonnes, also up 20% onthe year, the statement showed. China is the world's dominant producer of rare earths, a prized group of17 minerals used in consumer electronics and military equipment. It announces quotas twice a year, splitting the mining quotas into thosefor light rare earths, the more common type, and heavy rare earths. "The quota increase was pretty inevitable with the current supplysituation in China and demand growth from NdFeB manufacturers," said WoodMackenzie analyst David Merriman, referring to a type of rare-earth magnetused in consumer goods. Neighbouring Myanmar supplies around half of China's heavy rare earthsfeedstock but the closure of a key border crossing to contain the spread ofCOVID-19 has seen shipments dry up. "I expect the tight supply situation for (heavy rare earth) feedstock topersist until the Myanmar border reopens," Merriman added in an email. Quotas for the first half of 2021 were earlier set at 84,000 tonnes formining and 81,000 tonnes for smelting and separation. The full-year quotas,which have been published unusually late, imply the same levels for thesecond half. The quotas are awarded to six state-run companies, including ChinaMinmetals Rare Earth Co , Chinalco Rare Earth & Metals Co andChina Northern Rare Earth Group . The Minmetals unit last week flagged potential consolidation of theso-called "Big Six" when it said its parent was discussing restructuring withChinalco and the government of rare earths hub Ganzhou. The table below shows company rare earth quotas for 2021 in tonnes. Company Light rare Medium/heavy Smelting/sepa earth ore rare earth ore ration Chinalco Rare Earth & Metals Co 14,550 2,500 23,879 China Minmetals Rare Earth Co 2,010 5,658 China Northern Rare Earth Group 100,350 89,634 Xiamen Tungsten 3,440 3,963 China Southern Rare Earth Group 33,950 8,500 28,262 Guangdong Rising Rare Metals 2,700 10,604 Total 148,850 19,150 162,000
(Reporting by Tom Daly; Editing by Kirsten Donovan and David Evans)
Disclaimer: The views expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.