Leading Chinese rare earths producers sign cooperation deal

By Albert Li
Published: Thursday, 14 December 2017

Two of the biggest rare-earth companies in China, China Northern Rare Earth High-tech and Xiamen Tungsten, have signed a strategic cooperation agreement.

A strategic cooperation agreement arose from a meeting between the two companies’ presidents in Xiamen in September. It was signed earlier this month in Baotou, Inner Mongolia.

Under the agreement, China Northern will guarantee to supply Changting Jinlong, a subsidiary of Xiamen Tungsten, with 30-50 tonnes per month of praseodymium/neodymium oxide and 10-30 tonnes of neodymium oxide.

It will also supply Xiamen Tungsten with 40-50 tpm of lanthanum and 30-40 tpm of lanthanum/cerium for its hydrogen storage alloy powder project.

Meanwhile, Changting Jinlong will guarantee to satisfy all the magnetic material needs for subsidiary companies of China Northern and their purchasing demands for middle and heavy rare earths, such as dysprosium metal, terbium metal, gadolinium metal, holmium metal and other special rare-earth metals.

The agreement allows for the volumes of these supplies to increase gradually depending on capacity expansion.

The agreement for cooperation between China Northern, the biggest light rare earth producer in the north of the country, and Xiamen Tungsten, the leading middle and heavy rare earth producer, also includes research and development into hydrogen storage material, rare earth metal production, and other projects.

It will also help to stabilize market prices and strengthen consolidation in China’s rare earth sector.

At the same time as it signed the agreement with Xiamen Tungsten, China Northern also renewed its rare earth concentrate supply contract with Inner Mongolia Baotou Steel.

This set a trading price for rare earth concentrate at RMB14,000 ($2,109) per tonne exclusive of taxes and RMB16,380 per tonne with VAT, with effect from September 1, 2017.

The total volume to be traded each year will not exceed 300,000 tonnes.

The confirmed price in the first half of 2017 between the two companies was only RMB9,250 per tonne exclusive of taxes and RMB10,822.50 per tonne with VAT.