INDUSTRIAL METALS / MINERALS

China earmarks special fund for rare earth regulation, advancement

In the wake of tumbling rare earth prices and weak regulation, China’s Central Government has responded with the creation of a new fund.

RENO (MINEWEB) - 

China has earmarked a special fund from China’s Central Government Budget to streamline and improve the domestic rare earths industry.

The fund will be used to help rare earth companies upgrade their technology in order to operate in a more responsible manner environmentally. It will also be used to help provinces, autonomous regions, and local governments regulate and promote “the healthy and orderly development” of the rare earth sector.

The money will be used to support the supervision of rare earths resource extraction, the use of green mining techniques for rare earths, and the implementation of low-power, low emission, clean and efficient smelting technology, according to a notice published on the website of China’s Ministry of Finance.

Local governments will also receive Central Government Funds to crack down on illegal mining and exploration.

However, the maximum amount the fund will allocate to a high-tech rare earths application project is 50 million yuan (US$8 million per project). Government financial support to these projects will be limited to 20% of the rare earth’s project annual investment, according to Shanghai Daily.

Rare earth mining and refining companies vetted by state environmental authorities may also get a financial award for every ton of rare earths production from the fund.

The Central Government’s rare earths assistance and regulation fund was announced after many Chinese rare earth companies reported their profits plunged and announced production cuts, Shanghai Daily reported.