Chinese authorities are considering tightening pollution standards for rare earth mining, according to sources at a rare earth production base in the Inner Mongolia Autonomous Region.

"We heard the new standards will be strict, which will force uncompetitive miners out of the industry," said Zhang Zhong, general manager of Inner Mongolia Baotou Steel Rare-Earth (Group) Hi-Tech Co Ltd, the country's biggest rare earth producer.

Zhang said the new regulation will increase the production cost of rare earth minerals and may raise the price of Chinese rare earth exports.

Yang Wanxi, a government adviser involved in drafting the regulation, said the new standards aim to upgrade production techniques.

Experts said the permissible amount of the pollutant ammonia nitrogen per liter of production waste water will be lowered from 25 to 15 milligrams, said Yang, a rare earth specialist with the government of Baotou City in Inner Mongolia.

He said the experts also suggested that the government consider eliminating producers whose annual production capacity is less than 8,000 tons of mixed rare earth minerals.

Yang said the draft regulation has been filed with the Ministry of Industry and Information Technology, which is canvassing opinion within the industry on the proposals.

Rare earth minerals, a class of 17 chemical elements, have become increasingly important for the manufacturing of high-tech products like flat-screen monitors, electric car batteries, wind turbines and missiles.

But mining rare earth minerals damages the environment.

Premier Wen Jiabao said at the sixth China-EU Business Summit in Brussels in October that China, which has 97 percent of the world's supply of rare earth minerals, is looking for a sustainable method of extraction.

He said proper control and regulations are important and China will not close the market.

China stopped issuing new rare earth mining licenses in 2006 and has closed hundreds of small mines.

The government in September announced draft guidelines for the industry's next five years of development, which encouraged mergers and acquisitions in the sector.

The guidelines aim to cut the number of rare earth firms from 90 to 20 by 2015.

(Xinhua News Agency November 8, 2010)