updated 1/22/2011 5:09:24 PM ET 2011-01-22T22:09:24

Having acquired a monopoly over supplies of critical and rare-earth elements with low labor costs and lax environmental regulations, China is now ratcheting back on its exports of those metals and nationalizing their production, a panel of experts told the first-ever Critical Metals Investment Symposium, hosted by Cambridge House International, in Vancouver today.

The upshot for investors, said researcher John Kaiser, editor of the Kaiser Bottom-Fish Report, is that end-users or critical metals are scrambling for new and reliable suppliers in a commodity sector that is about one-tenth the size of the $324 billion base-metals market and only half the size of Facebook's estimated market value.

"China is creating a rare-earth cartel," Kaiser said, "by closing inefficient mines and nationalizing the production of key elements in order to meet its internal demand and to get a handle on how much 'Back market' material is being produced from the provinces."

Critical metals and earth elements are not particularly rare, and include molybdenum, tungsten, tin, antimony, indium, tantalum, germanium, gallium and zirconium. All are vital to green energy, hybrid auto manufacturing, and a multitude of manufacturing and electronic processes. Their production from known ore bodies outside of China ceased decades ago after being eclipsed by China's lower prices, and returning non-Chinese mines to production will not occur overnight, Kaiser said.

The Critical Metals Symposium, which concludes tomorrow, presages the opening Sunday of the Cambridge House Vancouver Resource Investment Conference at the Vancouver Convention Centre West. Well over 400 companies and some 50 guest speakers and panelists are scheduled to scheduled to present investment knowledge and opportunities to a large number of attendees.

© Marketwire 2013


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