China eyes curbing rare earth price surges amid inflation fears+

BEIJING, July 18 Kyodo -
Chinese Commerce Minister Chen Deming indicated Monday that Beijing will study measures to address sharp price increases in rare earth minerals.
''Surges in rare earth prices are not desirable for the Chinese economy as they will induce import inflation,'' Chen was quoted by Japanese trade minister Banri Kaieda as telling him in a meeting in Beijing. ''China would like to address speculative price movements.''
It is unusual that a senior Chinese official expresses concern about rises in rare earth prices.
Kaieda told reporters after the meeting that he and Chen shared a view that a surge in rare earth prices would lead to higher prices in parts using rare earths that China imports from Japan and that could negatively affect the Chinese economy whose biggest risk is inflation.
Kaieda, minister of economy, trade and industry, asked that China ensure a stable supply of rare earths to Japan without reducing export quotas.
Japan relies on China for about 90 percent of its supply of rare earths, which are vital in the production of hybrid vehicles, mobile phones and other high-tech products.
Beijing supplies more than 90 percent of the world's rare earth minerals, although it has about 35 percent of global reserves.
Kaieda said he briefed Chen about Japan's efforts to bring under control continued radioactive leaks into the environment from a crippled Fukushima Prefecture nuclear power plant.
Kaieda also asked China to ease import restrictions on Japanese agricultural and food products by stressing Japan will ensure the safety of products from radioactivity leaking from the Fukushima Daiichi nuclear power plant struck by the March 11 earthquake and tsunami.
Kaieda was on a three-day visit to China that took him to Shanghai and Wuhan where he attended the opening ceremony for an office of the Japan External Trade Organization.
==Kyodo
2011-07-18 22:07:32