China Posts a Trade DEFICIT! Arabs & Australia sucking out Chinese wealth

[ArcticSplash]

The skyrocketing price of oil and the super-historic high of sugar and cotton, which China does not produce, has rocked China's economy once again...

U.S. futures fall after Chinese trade data Indications - MarketWatch



Remember, China suffers a worse problem with petroleum than the United States does---it does not produce much of it, where the United States is the 3rd largest producer (we happen to consume almost all of what we produce). That requires China to buy from neighbors like Russia, Petrobras in Brazil, Chavez, etc.

Minerals and metallurgy is another area where China has a built-in deficit except in rare-earth metals. It pumps money into Australia's economy to get raw materials like ore.

This has caused Australia's economy to overheat and it's raised the Australian dollar above the USD.

On top of this, the great worldwide food inflation crisis has now pumped a huge amount of money into US agriculture. Most farmers in the US are having their flushest year ever thanks to the destruction of grains crops this past summer in Russia, which leaves the United States, Brazil and Mexico feeding most of the developing world on their terms.


Could this be the beginning of the end of China's great wealth-sucking vortex? Could the raw materials producers like Australia be the new "it" country?

[gren]

Seems there are a few reasons. Chinese New Year meant more consumption and less production in February. Devalued Yuan means imports cost more. A short term trend doesn't necessarily mean much. Since China relies so much on manufacturing it would have to import a lot before recouping the value in exports. Maybe they're just getting ready for increased U.S. demand as our economy rises :O

[desolate]

The skyrocketing price of oil and the super-historic high of sugar and cotton, which China does not produce, has rocked China's economy once again...

U.S. futures fall after Chinese trade data Indications - MarketWatch



Remember, China suffers a worse problem with petroleum than the United States does---it does not produce much of it, where the United States is the 3rd largest producer (we happen to consume almost all of what we produce). That requires China to buy from neighbors like Russia, Petrobras in Brazil, Chavez, etc.

Minerals and metallurgy is another area where China has a built-in deficit except in rare-earth metals. It pumps money into Australia's economy to get raw materials like ore.

This has caused Australia's economy to overheat and it's raised the Australian dollar above the USD.

On top of this, the great worldwide food inflation crisis has now pumped a huge amount of money into US agriculture. Most farmers in the US are having their flushest year ever thanks to the destruction of grains crops this past summer in Russia, which leaves the United States, Brazil and Mexico feeding most of the developing world on their terms.


Could this be the beginning of the end of China's great wealth-sucking vortex? Could the raw materials producers like Australia be the new "it" country?

Do remember that China controls most if not all of the most important rare earth metals and have been bribing everyone to produce there.

People like Apple and intel anyone who needs board and chips.

If they wnated they could strangle that market. Not much we could do.

Otherwise great news for us!

Sadly, aren't we stillpaying these farmers subsidies from our own failed budget?

[Politburo]

Do remember that China controls most if not all of the most important rare earth metals and have been bribing everyone to produce there.

China produces most of the rare earths at this time. But they control less than 40% of known reserves. With China's announcement that they would restrict rare earth exports, a mine in California is set to reopen, as well as several others around the world. Recycling rates are also increasing.

[LUCas]

Devalued Yuan means imports cost more.

And since the Chinese gov't artificially devalues the yuan and has the means to let it rise, I don't think we need to worry about our Chinese overlords friends, just yet.

[desolate]

China produces most of the rare earths at this time. But they control less than 40% of known reserves. With China's announcement that they would restrict rare earth exports, a mine in California is set to reopen, as well as several others around the world. Recycling rates are also increasing.

That Cali mine only opened becuase CHina has increased the value of said minerals so much that it's now profitable (barely) in the US.

Aren't the other 40% in areas filled with well... war and violence?

[Politburo]

Yes, the California mine opened because of the change in price.. but my point was that China doesn't control all of the rare earths as you asserted.

As for your question... yes, so long as you consider Australia, South Africa, Japan, Greenland, Vietnam, Estonia and Canada as areas filled with war and violence.

[desolate]

Yes, the California mine opened because of the change in price.. but my point was that China doesn't control all of the rare earths as you asserted.

As for your question... yes, so long as you consider Australia, South Africa, Japan, Greenland, Vietnam, Estonia and Canada as areas filled with war and violence.

Until 1948, most of the world's rare earths were sourced from placer sand deposits in India and Brazil.[8] Through the 1950s, South Africa took the status as the world's rare earth source, after large veins of rare earth bearing monazite were discovered there.[8] Through the 1960s until the 1980s, the Mountain Pass rare earth mine in California was the leading producer. Today, the Indian and South African deposits still produce some rare earth concentrates, but they are dwarfed by the scale of Chinese production. China now produces over 97% of the world's rare earth supply, mostly in Inner Mongolia,[9][10] even though it has only 37% of proven reserves.[11] All of the world's heavy rare earths (such as dysprosium) come from Chinese rare earth sources such as the polymetallic Bayan Obo deposit.[10][12] In 2010, the USGS released a study which found that the United States had 13 million metric tons of rare earth elements.[13]

New demand has recently strained supply, and there is growing concern that the world may soon face a shortage of the rare earths.[14] In several years, worldwide demand for rare earth elements is expected to exceed supply by 40,000 tonnes annually unless major new sources are developed.[15]

These concerns have intensified due to the actions of China, the predominant supplier. Specifically, China has announced regulations on exports and a crackdown on smuggling.[16] On September 1, 2009, China announced plans to reduce its export quota to 35,000 tons per year in 2010-2015, ostensibly to conserve scarce resources and protect the environment.[17] On October 19, 2010 China Daily, citing an unnamed Ministry of Commerce official, reported that China will "further reduce quotas for rare earth exports by 30 percent at most next year to protect the precious metals from over-exploitation".[18] At the end of 2010 China announced that the first round of export quotas in 2011 for rare earths would be 14,446 tons which was a 35% decrease from the previous first round of quotas in 2010.[19]

As a result of the increased demand and tightening restrictions on exports of the metals from China, searches for alternative sources in Australia, Brazil, Canada, South Africa, Greenland, and the United States are ongoing.[20] Mines in these countries were closed when China undercut world prices in the 1990s, and it will take a few years to restart production as there are many barriers to entry.[16] One example is the Mountain Pass mine in California, which is projected to reopen in 2011.[10][21] Other significant sites under development outside of China include the Nolans Project in Central Australia, the remote Hoidas Lake project in northern Canada,[22] and the Mount Weld project in Australia.[10][21][23] The Hoidas Lake project has the potential to supply about 10% of the $1 billion of REE consumption that occurs in North America every year.[24] Vietnam signed an agreement in October 2010 to supply Japan with rare earths[25] from its northwestern Lai Châu Province.[26]

[Politburo]

Do you really not understand the distinction between "produces" and "controls"?

[loveisnoise]

This is exactly why you need to get a towel to dry off the wetness behind your ears, quit wasting your current employer's money with your constant trips to google, and grow up by learning things in the real world besides copying and pasting.

Until 1948, most of the world's rare earths were sourced from placer sand deposits in India and Brazil.[8] Through the 1950s, South Africa took the status as the world's rare earth source, after large veins of rare earth bearing monazite were discovered there.[8] Through the 1960s until the 1980s, the Mountain Pass rare earth mine in California was the leading producer. Today, the Indian and South African deposits still produce some rare earth concentrates, but they are dwarfed by the scale of Chinese production. China now produces over 97% of the world's rare earth supply, mostly in Inner Mongolia,[9][10] even though it has only 37% of proven reserves.[11] All of the world's heavy rare earths (such as dysprosium) come from Chinese rare earth sources such as the polymetallic Bayan Obo deposit.[10][12] In 2010, the USGS released a study which found that the United States had 13 million metric tons of rare earth elements.[13]

New demand has recently strained supply, and there is growing concern that the world may soon face a shortage of the rare earths.[14] In several years, worldwide demand for rare earth elements is expected to exceed supply by 40,000 tonnes annually unless major new sources are developed.[15]

These concerns have intensified due to the actions of China, the predominant supplier. Specifically, China has announced regulations on exports and a crackdown on smuggling.[16] On September 1, 2009, China announced plans to reduce its export quota to 35,000 tons per year in 2010-2015, ostensibly to conserve scarce resources and protect the environment.[17] On October 19, 2010 China Daily, citing an unnamed Ministry of Commerce official, reported that China will "further reduce quotas for rare earth exports by 30 percent at most next year to protect the precious metals from over-exploitation".[18] At the end of 2010 China announced that the first round of export quotas in 2011 for rare earths would be 14,446 tons which was a 35% decrease from the previous first round of quotas in 2010.[19]

As a result of the increased demand and tightening restrictions on exports of the metals from China, searches for alternative sources in Australia, Brazil, Canada, South Africa, Greenland, and the United States are ongoing.[20] Mines in these countries were closed when China undercut world prices in the 1990s, and it will take a few years to restart production as there are many barriers to entry.[16] One example is the Mountain Pass mine in California, which is projected to reopen in 2011.[10][21] Other significant sites under development outside of China include the Nolans Project in Central Australia, the remote Hoidas Lake project in northern Canada,[22] and the Mount Weld project in Australia.[10][21][23] The Hoidas Lake project has the potential to supply about 10% of the $1 billion of REE consumption that occurs in North America every year.[24] Vietnam signed an agreement in October 2010 to supply Japan with rare earths[25] from its northwestern Lai Châu Province.[26]

[boblee]

At least we control the world's supply of Upsidaisium.

Upsidaisium

[desolate]

Do you really not understand the distinction between "produces" and "controls"?

If you're producing 97%, you control.

[desolate]

This is exactly why you need to get a towel to dry off the wetness behind your ears, quit wasting your current employer's money with your constant trips to google, and grow up by learning things in the real world besides copying and pasting.

Huh?

China controls the materials required for prety much all modern electronic.

and Google is you're friend, unless you're Glen Beck, then you don't trust anything.

[loveisnoise]

If you're producing 97%, you control.

Wrong. Try again.

[loveisnoise]

Google is only your friend if you understand what you're reading.

Huh?

China controls the materials required for prety much all modern electronic.

and Google is you're friend, unless you're Glen Beck, then you don't trust anything.

[desolate]

Google is only your friend if you understand what you're reading.

The United States once was largely self-sufficient
in these critical materials, but over
the past decade has become dependent upon
imports (fig. 1). In 1999 and 2000, more
than 90% of REE required by U.S. industry
came from deposits in China.


USGS

http://pubs.usgs.gov/fs/2002/fs087-02/fs087-02.pdf


Again. China. Dominant. Control. Market. Bad.