"China Cuts Rare Earth Export Quotas; U.S. Concerned"

"China said on Tuesday it will cut its export quotas for rare earth minerals by more than 11 percent in the first half of 2011, further shrinking supplies of metals needed to make a range of high-tech products.

China produces about 97 percent of rare earth minerals, used worldwide in high-technology, clean energy and other products that exploit their special properties for magnetism, luminescence and strength.

The rare earth issue could further strain U.S.-China ties, which have been battered this year by arguments over human rights, Tibet, Taiwan, the value of the Chinese currency and North Korean military attacks on South Korea.

Chinese President Hu Jintao is due to visit the United States next month for talks with President Barack Obama that both sides hope can stabilize the vital relationship.

Beijing says its curbs are for environmental reasons and to guarantee supplies to Chinese clean energy firms it is trying to promote internationally. But it has also said its dominance as a producer should give it more control over global prices."

Niu Shuping, David Stanway, and Michael Martina in Beijing; and Roberta Rampton and Paul Eckert in Washington report for Reuters December 29, 2010.

SEE ALSO:

"U.S. Threatens WTO Action On China Rare Earth Curbs" (Reuters)

"China Defends Rare Earth Quotas " (Toronto Globe and Mail)

"In China, Illegal Rare Earth Mines Face Crackdown" (New York Times)

"Main Victims of Mines Run by Gangsters Are Peasants" (New York Times)