Avalon Issues Bulletin on China Abolishing the Rare Earth Export Quota System

Avalon Rare Metals Inc. (NYSEMKT:AVL) announced that it has issued an industry bulletin on the announcement that China will replace export quotas with an export license process as a reaction to a WTO ruling.

Avalon’s VP of sales and marketing, Pierre Neatby, stated:

China has complied with parts of the WTO ruling and eliminated the export quota system. However, they have replaced the quotas with export licenses which will likely achieve the same objective. In my view, this new system will create much more uncertainty for buyers outside China as their deals will effectively be subject to approval from the Chinese government. In the past, if their supplier had quota, buyers would be reasonably assured of receiving supply. As a result of this new licensing system, and the uncertainty it will create, I would expect increasing volatility in rare earth prices.

Click here for the full Avalon Rare Metals Inc. (NYSEMKT:AVL) press release