The problem of the difficulty in exporting rare earths to China due to the Myanmar military coup that broke out on February 1 this year had not been confirmed to have much impact at first, but since mid-March, logistics have been slowing down and the future is uncertain.

Since Xi Jinping assumed the presidency in 2012, China has been tightening its controls on mineral mining, mainly due to environmental issues, in accordance with his wishes. Chinese mining resource companies are gradually shifting from domestic mining, which is becoming more difficult due to regulations, to importing. Imports from Myanmar started around 2016, and the volume has been increasing every year, and the total volume will continue to increase in 2019 and 2020.

Reference: Percentage of China's rare earth imports by destination country

It is said that Myanmar now accounts for the majority of domestic demand for rare earths with high atomic weight, such as terbium and dysprosium, and neodymium.

Myanmar is currently responsible for about 13% of the world's rare earth mining, but the main mining area is located in the northern region centered on Kachin State, which borders China's Yunnan Province and has the Ruili border checkpoint, a route for exporting mined materials, on its border.

Kachin State is home to the Kachin ethnic minority, who are mainly Christians. In 1961, thirteen years after Myanmar gained independence from British colonial rule, the Kachin Independence Organization (KIO) was established by Kachin intellectuals as an armed organization aiming to expand the autonomy of the Kachin people.

There are several ethnic minority groups in Myanmar, including the Rohingya Muslim minority, and it is said that there used to be about 20 armed groups scattered around the country's borders, but the KIO has a relatively strong independence orientation, and has maintained its presence even as the armed groups agreed to a ceasefire with the government after the transition from military to civilian rule in 2011.  Since then, there have been frequent troubles, such as the deployment of military troops around the province in May 2018, forcing the evacuation of about 20,000 ethnic people. In the wake of the recent military coup, the KIO attacked the national military base on March 11 last month, and since then, clashes between the two sides have been occurring intermittently for about a month, and this background has led to the current issue over rare earths.

Myanmar Domestic Map　　　　　　　　Checkpoint on the Myanmar/China border.( The point with the red dot)

In addition, this is not the only factor preventing China from importing Myanmar's rare earths. Myanmar's rare earth exports to China have often been halted due to the Myanmar government's decision to cite adverse environmental impacts, including in November 2108 and twice in 2019.

Thus, China's imports of Myanmar rare earths are based on a precarious balance to begin with. In spite of this, China's dependence on Myanmar is increasing every year, and the risk of rare earth price fluctuations is rising.

As for the current situation, according to reports from various media, the city of Ruili in Yunnan Province has been under a city blockade since the end of March due to the spread of corona cases. The supply of rare earths and tin to China entering the northern Ruili border checkpoint has been cut off, and if this situation continues, mining operations in Myanmar itself may eventually have to be suspended. The future of this situation depends on the above-mentioned political situation in Myanmar, so it is extremely uncertain.

Now then, let's check each indicator here. Praseodymium oxide and ferrodisprosium have reached their highest prices in the past five years. Several experts have pointed out that the Myanmar problem is behind the price hike.

Terbium oxide, which peaked at $1,550 on March 10 and is now at $1,425.

Terbium oxide（99.99%　USD/kg　FOB China）five years

Praseodymium oxide. The price peaked at $79,000 the week before last and settled down, but reached a new high of $79,700 this week.

Praseodymium oxide（99.5%　USD/ton　FOB China）five years

Ferrodysprosium. It hit $460 last week, but recently hit 470.

Ferrodysprosium（99%minDy80%　USD/kg　FOB China）five years

Neodymium metal. Moved from $129 last week to $123 recently.

Neodymium metal（99%　USD/kg　FOBChina）five years

（IRuniverse）