China Cuts Rare Earth Output, Prices Still Being Pressured

Reuters reported that top rare earth producers in China had announced plans to cut their rare earth output by around ten percent in response to lower prices. However, the news agency stated that illegal rare earth exports will likely put a cap on any price rises.
As quoted in the publication:

Last month, the country’s top producer China Northern Rare Earth High Tech Corp and five other main suppliers said that due to weak prices, they would produce around 10 percent less than their 2015 government-set output targets.
China is the world’s dominant producer of rare earths, accounting for 90 percent of global supplies.
“The cuts caused a short-term bump (in prices), but the real problem is that it’s only a small drop in the ocean,” said David Merriman, senior analyst at consultancy Roskill Information Services in London.
“The amount of illegal production that is still being produced is strong enough to keep downward pressure on pricing.”

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