State-owned miners Aluminum Corporation of China, China Minmetals and Ganzhou Rare Earth Group have reorganized their rare earth mining and production assets into a new Jiangxi province-based entity called China Rare Earth Group.
In so doing, China further consolidated its rare earth industry, approving a three-party merger to form one of the world’s largest rare earth companies in December 2021, according to the US Economic and Security Review Commission and China (USCC).
China Rare Earth Group will control 40% of China’s rare earth mining output, or about a quarter of global mining output using 2020 figures.
As a sectoral example related to these inputs, China dominates global supply chains for components used in clean energy technologies, including the refining of critical minerals such as lithium, rare earth minerals, and copper.
Earlier this month, the state-owned China Northern Rare Earth (Group) High-Tech, which in 2021 controlled around 60% of China’s rare earth mining output, formed a strategic partnership with another non-state rare earth miner, China Rare Earth Holdings.
The companies will coordinate to mine and process rare earths in the northern province of Inner Mongolia, which has more than 80% of China’s proven rare earth deposits.
For the USCC, the merger is designed to strengthen China’s dominance in global supply chains for strategic items.
China Rare Earth Group
The magnetic and conductive properties of rare-earth elements make them critical components in high-tech applications like electric vehicles, smartphones and wind turbines, and China occupies an outsized position in both mining and processing the elements.
Mines in China produced about 60% of the world’s supply of all rare earths in 2020, according to the US Geological Survey.
The country also controls about 85% of the processing to turn rare earths into useful components, such as alloys and permanent magnets.
China Rare Earth Group will be among about 100 “core companies” directly supervised by the State Assets Supervision and Administration Commission, which controls 31% of the new company.
Aluminum Corp., China Minmetals and Ganzhou Company each have a 20 percent stake.