The campaign led by China's Ministry of Industry and Information Technology (MIIT) to crack down on illegal rare earth mining and production activities will likely prop up the rare earth prices in the short term, according to the Shanghai Metals Market (SMM), a leading metal information provider in China. The MIIT said earlier that it would crack down on illegal rare earth mining and production nationwide from November 1 to December 20. The illegal rare earth mining and production directly lead to the oversupply in the rare earth industry.
The crackdown will likely improve the supply situation and boost the rare earth prices in the short term, said analysts of the SMM. On the domestic stock market, rare earth companies, including China Minmetals Rare Earth Corp (000831.SZ), Rising Nonferrous Metals Co. Ltd. (600259.SH), Xiamen Tungsten Co. Ltd. (600549.SH), and China Northern Rare Earth (Group) High-tech Co., Ltd (600111.SH) and Shenghe Resources Holding (600392.SH), will likely benefit from the crackdown campaign.
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