China has drawn criticism from the US and EU after refusing to increase export quotas on rare metals vital for clean technologies, such as solar panels and wind turbines.
The country accounts for more than 90 per cent of worldwide output of rare earth minerals and had been under pressure to increase supplies as governments and analysts warned of shortages and subsequent price spikes that could undermine the expansion of the global clean tech industry.
However, the Chinese Ministry of Commerce yesterday announced that export levels would remain similar to last year, despite rising demand.
Meanwhile, the EU warned that the inclusion of ferroalloys, which contain rare earth metals, in the quotas for the first time represent a tightening of the quotas in real terms.
"This is highly disappointing and the EU continues to encourage the Chinese authorities to revisit their export restrictions policy to ensure there is full, fair, predictable and non-discriminatory access to rare earth supplies, as well as other raw materials for EU industries," said John Clancy, the EUs trade spokesman.
The UK department for Business, Innovation and Skills told BusinessGreen it was entirely in agreement with the EUs position.
The US, meanwhile, had been hoping the World Trade Organisation decision earlier this month to prevent China placing restrictions on exports of zinc, bauxite and other key raw materials would dissuade its ruling party from tighter quotas on rare metals. However, it was left equally dissatisfied with the decision.
"We continue to be deeply troubled by Chinas use of market distorting export restrictions on raw materials including rare earths," Nkenge Harmon, a spokeswoman for the US Trade Representatives office, told news agency Reuters. "This is not the direction that China should be headed in."
Chinas state news service, Xinhua, said that "decades of excessive exploitation" had seen its reserves fall from around 85 per cent of total global reserves in the 1990s to about one-third of reserves currently, leaving a legacy of environmental damage in the process.
Chinas restrictive quotas have seen prices of rare metals soar and sparked a new gold rush in Australia and South Africa, although any new reserves that are discovered are unlikely to be in production until 2013.
source: apec-vc korea