China's Chinalco sets up rare earths processing firm

Chinalco, China's largest alumina producer, has set up a company in the country's east that will separate highly profitable rare earths from crude ores, a spokesman said Wednesday.

The company, a joint venture in Jiangsu province, was launched on Tuesday, Chinalco spokesman Yuan Li told AFP.

Chinalco said in a statement Wednesday that the company, launched with five firms in Jiangsu that are authorised to separate the metals and a rare earths trading company, would have an annual capacity of over 30,000 tonnes.

Financial details of the project were not disclosed.

Chinalco is seeking to diversify from aluminium into other sectors such as coal, iron ore, rare earths and copper to become a global commodities firm.

Chinalco has in recent years acquired rare earth assets in provinces such as Jiangxi in eastern China, which is rich in the more expensive and scarce heavy rare earths, in a move to further consolidate the industry, the statement said.

The company is aiming to "build a national team in the rare earths industry... that will participate in global competition", it said.

The value of Chinalco's operational rare earths assets is more than 1.2 billion yuan ($185.3 million), the company said.

China produces more than 95 percent of the world's rare earths -- 17 elements critical to making everything from iPods to electric cars and missiles -- and Beijing has been trying to bring the minerals under state control.