China denies blocking rare earth shipments to US, Europe

China's Commerce Ministry denied the New York Times report stating the government has extended block on shipments of rare earth to include the United States and Europe, other than Japan, a Bloomberg report said, citing a faxed response from the Ministry.

A report by New York Times on Tuesday stated that China has quietly halted shipments of crucial minerals to the U.S. and Europe, quoting industry officials. The report spurred the U.S. government to look into the matter.

China had previously suspended exports of rare earth minerals to Japan over a territorial issue regarding the latter's detention of a Chinese fishing captain, whose boat collided with Japanese patrol boats in September.

However, the Chinese Ministry still continues to deny any delay or suspension on shipments to Japan, despite various confirmation of the suspension.

There was speculation that the announcement came after there were indications that American trade officials would investigate if China was indeed violating World Trade Organization rules by subsidizing clean energy exports and limiting clean energy imports.

The investigation includes whether China's steady reduction in rare earth exports quotas since 2005, along with steep export taxes on rare earths, are illegal attempts to force multinational companies to produce more of their high-technology goods in China, the NYTimes said.

China mines about 90 percent of the world's rare earth minerals - which is a collection of seventeen chemical elements and is used to various technological devices, including various superconductors, cellphones and other gadgets that have both commercial and military uses.

China might raise the production cap and export quota slightly next year, Wang Caifeng, who was the deputy director at the Ministry of Industry and Information Technology overseeing the sector, told Bloomberg, contradicting the NYTimes report on Monday that stated that China plans to reduce up to 30 percent in its quota for exports of rare earth minerals.

Caifeng is now in charge of setting up the China Rare Earth Industry Association.

China maintains that the restrictions on mining rare earth were to protect the environment.

It's also a bit hypocritical for the developed countries to ask China to reduce carbon emissions and reduce energy consumption, while criticizing China's move to consolidate the rare earth industry to preserve its own environment, Wang told Bloomberg.