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China Aluminum Gets Into Rare Earths Game
Aluminum Corporation Of China Limited (ACH), China’s state-controlled aluminum producer, is getting into the ultra-hot rare earths sector by acquiring a controlling interest in state-run Guangxi Nonferrous Metals Mining Group. Chinalco will hold 50% of the company while Guangxi Nonferrous will hold 40% and Grirem will own the remainder, according to China Daily.
China is the world’s largest rare earths exporter, controlling 95% of the market, but the country has been paring its rare earths exports in recent months, driving prices of the 17 elements used in an array of high-tech gadgets higher. That has been good news for the Rare Earths Stocks Index, which is down 3% today, but has surged almost 40% in the past month.
To this point Chinalco has not been a rare earths player, but the Chinese government wants large companies to lead consolidation in the sector and with government support, the aluminum giant is getting a foothold in the rare earths space, China Daily reported.
With the broader market pulling back today, rare earths stocks are seeing their worst performance in quite a while with Avalon Rare Metals (AVL), Rare Element Resources (REE) and Molycorp (MCP), the largest U.S.-based rare earths miner, all down 3%. Lynas Corporation (LYSCF) is off 6%, as is Neo Material Technol (NEMFF).
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