On 14 Nov. 2011, MIIT released Notice on Carrying out Joint Inspection on Rare Earth Industry, according to which, during 11 Nov. to 25 Nov., four ministries and commissions including MIIT, Ministry of Land and Resources, Ministry of Environmental Protection and General Administration of Customs would take the lead, forming 5 joint inspection teams with other 11 ministries such as Ministry of Foreign Affairs, National Development and Reform Commission and Ministry of Public Security etc. The inspection teams would set out to 10 provinces in China to conduct on-site spot check towards rare earth projects.

The inspection is a focused investigation towards the achievement of rare earth industry improvement actions started in August 2011, of which the results will probably be considered as the authentication basis for deciding whether rare earth enterprises can carry on normal operation in the future. Meanwhile, accompanied by the special invoice regulation for rare earth industry under consideration, the inspection will become the beginning of elimination of small enterprises that cannot meet the standard.

In 2011H1, prices of rare earths skyrocketed, with price of neodymium oxide soaring to RMB1.5 million/ ton. After August, influenced by the unbalanced supply and demand, as well as idle funds selloff, prices of rare earths presented drastic fall. Currently, price of neodymium oxide is approximately RMB900,000 /ton, with a decline over 40%. In the future, with the progress of special inspection actions, such as launch of special invoice for rare earth industry, establishment of rare earth trading center and implement of strategic storage, prices of rare earths will maintain at a reasonable level, and huge fluctuation of prices will hardly appear.

Price of Neodymium Oxide in China, 2005-2011 (RMB/ton)

Source: NBS; ResearchInChina

Source: ResearchInChina