Reduced cobalt electric car batteries delayed amid price fall

The USA's largest rare earth producer Molycorp (NYSE:MCP) is mounting a credible challenge to Chinese rare earth dominance by dramatically scaling up output and potentially increasing its global market share to 30% from 4% at present.

The volume of rare earth minerals legally exported from China for the first half of 2012 plunged by 42.7% year-on-year to hit 4,908 tons according to statistics from China's customs authorities.

Police in the southern Chinese province of Guangdong announced on Tuesday that they have shut down nine rare earth mines operating illegally in Longchuan county over the past six months.

The World Trade Organization will investigate China's quotas and tariffs on rare earth minerals following prompting from the US, EU and Japan, who allege the export restrictions are in contravention of international trade regulations.

The Chinese government has halved the number of rare earth mining rights in the country pulling 65 permits in all, according to a report by ChinaDaily USA.

Recent discoveries of rare earth minerals at the bottom of the Pacific Ocean could break China's existing stranglehold on supply of the key raw materials.

The exchange will be located in Baotou city in Inner Mongolia region, which is home to nearly half the world's light rare-earth output.

The company said 50kg of dysprosium with 99.9% purity was separated from resins remaining from past production runs at the former Soviet Union's number one rare earth plant.

"Passage of this legislation is an important step toward recovering the 22,000 rare earth-related jobs the U.S. has lost since the 1980s.”