Chinalco Invests $1.5 Billion in Rare Earth Producer

Chinalco, which is seeking to diversify from aluminum to become a global mining firm, said on Sept. 27 that it would take a controlling stake in Jiangxi Rare Earth and Rare Metals Tungsten Group.

Chinalco, the country's biggest aluminum producer, will invest at least 10 billion yuan in the Jiangxi firm over the next three to five years to accelerate the development of rare earth resources, the statement said.

China supplies at least 95% of the world's rare earths, which are essential for making components used in a variety of products including iPods, electric cars and guided missiles.

The investment comes after Japanese traders accused China of blocking exports of the minerals to Japan, which Beijing has repeatedly denied, amid the worst diplomatic row between the two Asian powers in years.

Copyright Agence France-Presse, 2010