Apollo News reported that Chinese company Sheng and Resources plan to acquire Peak Rare Earths Limited, an Australian listed company. Australian media speculated that this signals China may strengthen its control on the world’s rare earth supply.

According to the Intercontinental Financial Review, the Chinese regime would further control the global rare earth supply lifeline if Shenghe Resources succeeds in acquiring Peak Rare Earths Limited (PEK).

The Australian Financial Review reported that Shenghe Resources, listed on the Shanghai Stock Exchange, intends to spend more than 39 million Australian dollars (about 20 million dollars) to buy 19.9% of PEK held by Appian Capital, a private equity fund.

The Australian Financial Review explains that of the 17 rare earth elements globally, 80% of production comes from China. With the Chinese Communist government setting production caps for Chinese rare earth mining and smelting companies, the regime has much influence over rare earth prices.

The paper mentions that if Shenghe Resources conducts the transaction, PEK’s market value will be close to A$196 million (140 million dollars), 24% higher than the Peak’s market cap at the close of trading on Friday 11th.

The U.S has added seven rare earth elements, including NdPr, to its list of minerals “essential” to national security and economic growth, owing to China’s dominance in the supply chain.

The Financial Review reported that Australia, the United States, and the United Kingdom committed to strengthening military ties. These countries would invest in additional rare earth supplies outside China, with Australian miner Lynas receiving money from the United States Department of Defense. Lynas even got help from Japan.

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