Interfax China reported that China Nonferrous Metal Industry's Foreign Engineering Construction Company Limited is to establish a rare earths JV with privately owned Yixing Xinwei Group Company Limited.

The move is intended to improve CNMC's chances of being chosen as one of the three companies that will lead south China's rare earths industry as part of consolidation plans announced May 19th 2011 by the State Council under which three major players will be handed control of 80% of the market.

The JV, NFC Rare Earths Company Limited will be based in Guangdong's provincial capital of Guangzhou and focus on rare earths separation.

A NFC representative said that the two sides will contribute assets worth an aggregate CNY 1 billion including CNY 300 million in cash with NFC taking a controlling 51% stake. CNMC's contribution will include a rare earths separation plant with 7,000 tonne capacity while Xinwei Group will contribute facilities with an annual separation capacity of 10,000 tonnes.

(Sourced from Interfax China)