The rare earth assets of China Minmetals Corporation, Aluminum Cooperation of China and Ganzhou Rare Earth Mining will be strategically reorganised to form a new company in Jiangxi Province dubbed China Rare Earth Group, Kallanish understands.

China Rare Earth Group will be listed in late December this year at the earliest. The financial consolidation is almost done. If established, it is likely to be the largest rare earth enterprise worldwide.

In September this year, Minmetals Rare Earth announced that it received China Minmetals Corporation’s notification indicating the potential establishment of the new company, though the plans remained to be confirmed and approved.

On 7 December, the highest per-share increase of China Rare Earth (HK) reached 18% and the A-share listing company Aluminum Cooperation of China received an opening daily limit.

China Rare Earth (HK) is a different company than the newly formed one. It is mainly engaged in the manufacture and sale of high-quality rare earth and refractory products. Its rare earth purification rate can reach as high as 99.99%.

According to official data through 2020, China has about one-third of global total rare earth resources.

There are a total of 17 rare elements in rare earths. According to the different composition of the elements, they are divided into light, medium and heavy rare earths. In China, light rare earths are mainly distributed in the north, and medium and heavy rare earths are clustered in the south. Baiyun Obo (Inner Mongolia) and Liangshan (Sichuan) store most of China’s light rare earths. Bayan Obo mine is the world's largest rare earth mine. The medium and heavy rare earths are concentrated in Ganzhou (Jiangxi Province), Longyan (Fujian Province), and the Nanling Mountains (including Hunan, Jiangxi, Guangxi, and Guangdong).

From 2001 to 2020, China's rare earth output accounted for more than 55% of the global rare earth output.

It is estimated that from 2019 to 2024, China's rare earth consumption will maintain a 5% growth momentum. It is estimated that by 2026, China's rare earth demand will reach 155,000 tonnes.

Since the beginning of this year, the new energy industry has developed rapidly. As a key material, the demand for rare earth permanent magnets has continued to grow, which has driven the prosperity of the rare earth industry.

China's rare earth permanent magnet production is expected to increase by 7% year-on-year to 210,000 t during this year. The export volume of China's rare earth permanent magnets is far greater than the import volume. It is expected that China's export volume of rare earth permanent magnets during this year will increase by 11% y-o-y to 40,000 t.

Since the beginning of this year, the prices of mainstream rare earth products such as praseodymium, terbium, and dysprosium have all hit new highs in the past 10 years.

Through further integration of its rare earth assets, China intends to strengthen control on the rare earth supply side and occupy a more dominant position in the upstream of the global rare earth industry chain during the new energy era.