Finally.
China's rare earth shipment strike (?) is now causing a rippling effect through the global demand for rare earths, which are in a key component for all computer/electronic related accessories, namely lithium based batteries, LCD/LED screens, navigation systems for missiles etc. As prices will start to spike on all software/electronic products.
The question is: Why has China done this? The answer: Why not? The US Treasury and government and Federal Reserve think they can arrogantly devalue the US Dollar, while verbally attacking China to revalue there YUAN, is the epitome of market hypocrisy.
China is saying fuck you, 'we cut shipments of rare earths to Japan and Japan released the Chinese fishing captain in hrs, now USA back the fuck off' (from Mandarin :) )
Same tactic bigger 'enemy', China are exerting economic/strategic power; you have to respect this if you provoke them. The US will just have to take the pain, or counter strike. But they will counter strike. Which will be? Obama tariffs overdrive on ALL Chinese imports to the US before the mid-yr elections.
Trade war on, geo-political tensions up. Shit is collecting near the fan...
From Bloomberg 21/10/2010
"Rare-earth prices have jumped as Chinese export quotas crimped worldwide supplies for the elements used in the manufacture of disk drives, wind turbines and smart bombs.
Prices have climbed sevenfold in the last six months for cerium oxide, which is used for polishing semiconductors, and other elements have more than doubled, according to Metal-Pages Ltd. in London, which tracks rare-earth prices.
Actions by China, which produces more than 90 percent of the world’s rare earths, have drawn criticism from U.S. lawmakers and officials in Japan and Germany. China reduced its second-half export quota for the minerals by 72 percent in July. It is now further restricting exports, according to industry participants.
“Materials are still being held up in customs and shipments are delayed,” Jeff Green, president of J.A. Green & Company LLC in Washington, who represents miners and users of the elements, said in a telephone interview yesterday. “Many believe rare-earth quotas for the second half of 2010 are exhausted, leaving materials unavailable for sale.”
President Barack Obama’s spokesman said the National Security Council staff is looking into reports that China is blocking shipments.“They’ve seen the reports,” press secretary Robert Gibbs told reporters traveling with Obama on a West Coast campaign trip.“They’re looking into them but don’t have anything they could confirm about those reports.”
China’s Comments
China said the quota reduction was needed in order to shut polluting mines and still be able to meet domestic demand. It will “continue to supply rare earth to the world” while maintaining restrictions “to protect exhaustible resources and ensure sustainable development,” the Commerce Ministry said in a statement yesterday.
Contributing to the rise in prices is an expectation of further restrictions. China will probably tighten export controls on rare earths next year, Shigeo Nakamura, president of Advanced Material Japan Corp., said at a conference in China yesterday.
Rare earths are a group of 17 chemically similar metallic elements, such as lanthanum, cerium, neodymium and europium. The elements are used in radar, high-powered magnets, mini-hard drives in laptop computers, catalytic converters for vehicles, electric-car batteries and wind turbines.
“It’s pretty frightening that there may be a gap where U.S. industry pays an extraordinary price,” U.S. Representative Mike Coffman, a Colorado Republican, said in an interview. He said U.S. rare-earth mining isn’t likely to resume until at least late 2012 at a mine in Mountain Pass, California.
‘Unified Front’
“The administration needs to join with other countries and have a unified front to tell China this is not appropriate,” he said. "
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