China’s government eased its restrictions on rare-earth exports for the first time since 2005 in an apparent nod to a trade fight over Beijing’s tight global grip on production of the strategically important minerals.
But industry executives said the move will do little to shake China’s dominance of a market crucial to industries as diverse as oil refining, electric vehicles and ballistic missiles.
China’s Ministry of Commerce said Wednesday that it will permit 2.7% more volume of rare earth—30,996 metric tons—to leave the country this year than it did in 2011. The increase follows a number of tighter limits imposed since 2005 that led to major price surges beginning about two years ago, making some of the elements more valuable than gold.
The restrictions raised cries from industries dependent on the minerals. In July, the World Trade Organization accepted a complaint from the U.S., the European Union and Japan, putting pressure on China at a time when it is contending with other trade disputes with the U.S. ranging from cars to solar panels. China contends its export limits are one of a number of efforts spurred by environmental concerns.
“Pressure on China [to loosen export controls] has been quite high,” said Frank Tang, an analyst at investment bank North Square Blue Oak. He said China is “now signaling to the wider world not to worry.”