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Sydney, Sep 3, 2009 (ABN Newswire) - China's tightening rare earth export may affect the A$500 million takeover of Australian company Lynas Corporation (ASX:LYC) by a state-owned company.
China Nonferrous Metal Mining Group is seeking to purchase 51.6 per cent stake in Lynas, which is currently constructing the biggest new rare earths mine in the world.
Australia's Foreign Investment Review Board (FIRB) said it had not yet decided on whether to allow the deal amid reports that China would limit the supplies of rare earth to prop up the slumping prices.
China Non-Ferrous has already been asked to resubmit its investment application to the Australian regulator,this is the delay for the third time since the deal was announced. FIRB has set a new deadline of early October for its decision.
It is reported that Chinese government terminated new mining license for rare earth mines until June 2010 while some rare earth is expected to be prohibited for export.
Rare earth metals are widely applied in electronics products, such as iPods, mobile phones, plasma TVs, and also used for eco-friendly automobiles - hybrid cars. Japan, with its big electronics and automobile manufacturers, is the largest consumer of rare earth metals.
The rumour forced Japanese trade firms, such as Itochu Corp. (TYO:8001) and Toyota Tsusho Corp (TYO:8015), to urgently scour the globe for stable rare metals supplies. Air conditioner manufacturer Daikin Industries Ltd. (TYO:6367) is taking steps to lower its dependence on the use of the rare earth element dysprosium for the high-performance motors of its residential air conditioners.
China Nonferrous Metal Mining Group is seeking to purchase 51.6 per cent stake in Lynas, which is currently constructing the biggest new rare earths mine in the world.
Australia's Foreign Investment Review Board (FIRB) said it had not yet decided on whether to allow the deal amid reports that China would limit the supplies of rare earth to prop up the slumping prices.
China Non-Ferrous has already been asked to resubmit its investment application to the Australian regulator,this is the delay for the third time since the deal was announced. FIRB has set a new deadline of early October for its decision.
It is reported that Chinese government terminated new mining license for rare earth mines until June 2010 while some rare earth is expected to be prohibited for export.
Rare earth metals are widely applied in electronics products, such as iPods, mobile phones, plasma TVs, and also used for eco-friendly automobiles - hybrid cars. Japan, with its big electronics and automobile manufacturers, is the largest consumer of rare earth metals.
The rumour forced Japanese trade firms, such as Itochu Corp. (TYO:8001) and Toyota Tsusho Corp (TYO:8015), to urgently scour the globe for stable rare metals supplies. Air conditioner manufacturer Daikin Industries Ltd. (TYO:6367) is taking steps to lower its dependence on the use of the rare earth element dysprosium for the high-performance motors of its residential air conditioners.
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