Reuters reported that Russia offered Germany long term deals for natural gas and rare earths recently putting pressure on China which currently dominates the rare earths market and to end delays in agreeing to imports of Russian gas.

China controls 97% of the global supply of rare earth minerals used heavily in Germany electronics industry and Russian President Mr Dmitry Medvedev opened the door to German investment to exploit Russia's untapped reserves of the elements.

He told reporters, after talks with Chancellor Ms Angela Merkel and German business leaders in Hanover that “Of course we're ready to enter into new relations with our friend including on rare earths. I'm referring to a planned wave of privatizations. We expect German investments in this area."

Germany electronics industry says the market for rare earth minerals with magnetic, luminescent and other valuable properties is critical due to export curbs from China.

China eased the restrictions last week, restoring them to near 2010 levels but trading partners like the European Union and United States said it was not enough to ensure stable supplies of 17 rare earth metals which are crucial for the electronics, defense and renewable energy industries.

The issue became a flash point last year after China halted shipments to Japan in a diplomatic spat, showing it was ready to use its monopoly as a political tool.

Mr Viktor Zubkov Deputy Prime Minister said Russian deposits easily accessible and not requiring industrial extraction were of a volume "equal to global annual production."

(Sourced from Reuters)