"We hope the U.S. government can secure commitments from the Chinese government to remove export taxes and quotas on rare earths and to refrain from interfering with the commercial sale of rare earths," said Jeremie Waterman, senior director for China at the U.S. Chamber of Commerce.
He was addressing a panel of Obama administration officials at a hearing to gather information for an annual U.S. report on how well China abides by World Trade Organization rules.
Peter Dent, a vice president at Electron Energy Corp, the last U.S. producer of samarium cobalt magnets for commercial and defense uses, told the panel he believed China's restrictions on exports of rare earth metals and rare earth oxide violated WTO rules.
Rare earth magnets are used in many defense and environmentally-friendly technologies including computer hard disk drives, wind turbines, cell phones, hybrid electric vehicles, inertial guidance systems and microwave amplifiers used for communications and electronic warfare.
China currently controls nearly 100 percent of the world's rare earth metals and over 97 percent of rare earth oxides, Dent said. In recent years, it has taken a number of steps to curb exports, including "a drastic 72 percent cut in rare earth export quotas" announced in July that caused price spikes of more than 300 percent, he said.
"We would like to register our grave concern with these market disruptions and highlight the need for a U.S. government industrial and trade policy that protects our national security interests in cooperation with reliable industry players and ally nations," Dent said.
Waterman said he hoped the issued would be addressed at the annual U.S.-China Joint Commission on Commerce and Trade, which will be held in Washington later this year. (Reuters)
