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Commodities

Prices plunge after China drops export tax

TOKYO -- International prices of rare-earth metals, used widely in hybrid cars and other high-tech products, are in free fall a month after China scrapped its export tariffs.

     Neodymium, found in high-performance magnets, is trading at about $66 per kilogram. Having dropped 20-30% from April, it is now at levels seen before a surge that began in 2010. Dysprosium is hovering around $350 per kilogram, also a five-year low.

     After Sino-Japanese relations soured in 2010 over disputed islands, Beijing reduced export quotas, sending prices up sevenfold.

     China accounts for 70-80% of the global rare-earth supply. But after losing a case in the World Trade Organization, Beijing dropped the quota system this year and eliminated export tariffs May 1.

(Nikkei)

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