China recently eased restrictions on rare earth element exports for the first time since 2005 in an apparent cncession to a trade fight over the nation's tight grip on production of these strategically important minerals.



China's Ministry of Commerce last week allowed 2.7 per cent more volume of rare earth elemnst — some 30,996 tonness — to leave the country this year than it did in 2011.



The increase follows a number of tighter limits imposed since 2005 that led to major price surges beginning about two years ago, making some of the elements more valuable than gold.



Rare earth elements are used for everything from smartphones to guided missiles. While some rare earths are relatively common, they are dispersed in a way that makes it difficult to find deposits with high enough ore grades to economically exploit.



China's control of the rare earth market has come under increased scrutiny in recent years with as the nation slashed export quotas of rare earth minerals to cope with their growing domestic demand. U.S. industry officials suggest it is an unfair trade practice, against rules established by the World Trade Organization.



Currently China produces about 95 percent of global rare earth supplies. In a response to complaints from the US, the European Union and Japan the WTO last month set up panel to probe China's rare earth export policies.



In what is seen as the first step in loosening China's grip on the rare earth market, China's government raised its rare-earth export quota for the first time in seven years.



China's Ministry of Commerce last week reported that it will increase quotas by 2.7 percent to 30,996 tons. While the increase is a positive sign actual imports of rare earths have fallen sharply. During the first 7 months of the year exports have fallen 36.7 percent according to recent customs data.



Industry observers said the move comes as China's rare-earth export limits become less important. Chinese miners haven't come close to exporting as much as permitted during the past two years as manufacturers look to reduce their use of Chinese-produced minerals, leading to sharp price drops.



Companies in the U.S., Australia and elsewhere are also ramping up production of the minerals, which aren't rare despite their name but can be complicated to process. Mining operations also take a long time to set up.



China's rare-earth exports this year are well below the quotas. Exports in the first half reached slightly less than 5,000 tons, according to the state-run Xinhua news agency.