Saturday, 2 May 2015
Here is the good news for some rare earth importers worldwide:
Export duties on rare earths will be eliminated on May 1, 2015, the Ministry of Finance said in a statement on Thursday, a move that analysts said would stimulate China's exports of the limited resource.
Rare earths－a group of minerals that are crucial to the technology and defense industries－as well as tungsten and molybdenum will be exempt from tariffs, and wrought aluminum products will also enjoy a zero rate, the statement said.
The move, according to Du Shuaibing, an analyst at natural resources consultancy Baichuan Information, will reduce the prices of rare earths by 20 to 25 percent.
"Rare earth export volumes are expected to increase greatly, which will help producers digest inventories," said Du.
The move also will also have an impact on international rare earth prices, because lower-priced exports from China will affect sales of rare earths produced in other countries and regions.
The metals are used in products as varied as iPhones and wind turbines.
In 2014, rare earth exports reached 28,000 metric tons, up 27.3 percent from a year earlier. The average export price was 83,000 yuan ($13,300) per metric ton, down 47.8 percent.
But Du said that resource and environmental taxes on rare earth producers, which have caused production costs and therefore prices to rise, are still the primary concern in the market.
It is also crucial to crack down on illegal mining and smuggling, factors that lead to an oversupply, Du said.
China's six major rare earth groups, which dominate exports, are expected to complete most of the work necessary to integrate small mines and smelting companies by the end of 2015.
China is the world's largest producer and exporter of the minerals, but the industry is beset by problems including illegal mining, smuggling and a lack of competitiveness due to weak research and development.
The country raised tariffs and imposed strict output quotas in 2010 to not only protect its scarce resources, but also reduce the environmental impact of extraction. Importers in Japan, Europe and the United States complained that the move had breached trade rules.
Shares in producers of rare earths surged on Thursday after the duty change was announced. But Du said that participants in the industry will take a more measured view of policy changes.
Key movements for the industry
Before 2003: Exports are encouraged with rebates
2003-06: Exports are restricted, with rebates phased out
2006-14: Ceilings on exports are raised, export tariffs hiked annually
Jan 1, 2015: Tariff implementation plan enforced
Recently one of our South African clients lost more than 5000 USD by a 'fake’Chinese importer. They were offered a huge order valuing more than 9,000,000.00 USD and were invited to China to attend a so-called contract signing ceremony. The professional fraudsters have too many ‘pretexts’ to get money from the victims worldwide: notary fee, kickbacks, gifts, bribes etc. It is even hard for the local police to crack down such cases as they use all fake names and official documents in China. In order to warn more reliable businessmen worldwide, STIN Company Verification team summarized the features of China international buyer fraud case for your reference.
Features of Chinese import fraudsters:
1.Fully registered a NEW offshore trade company in Hongkong, with a created address and a created company name in Mainland China. Please note that they will use 'fake’identity cards to register the offshore trade company in China as well.
2.Leased a luxurious office temporarily, with at least three ‘actors’, one is act as a ‘president or CEO’, one act as a financial director and the other act as an ‘importer manager’ or assistant.
3.The offer (contract value) is very attractive and huge, valuing more than 1 million USD at least or even tens of millions USD, with favourable payment terms, say, 30% in advance by T/T within 24 hours upon the signature of the contract in person.
4.Claimed to be a big group company, with a wide range of business: trade, distribution, investment, manufacturing and so on. They claim to import all kinds of items from other countries.
5.Constructed a website, with many items on, disguised to be a group company online. They used an official company email box as well.
6.Used automatic Group Mailing system and they can sent tens of thousands of emails every day. If the receiver responds, then a guy will follow up by email and the trap begins. They never attend the trade fairs or shows in China.
7.Insist on signing the contract in person in China and they will invite you to attend their so-called Contract Signing Ceremony.
8.Insist on NOTARIZING the contract and they will appoint (designate) a local Notary Office (but normally this notary office is a NON-EXIST one in China.).
9.Used ‘fake’ Chinese invoice and Chinese official licenses.
10.Used ‘fake’ signature, they do not sign their names in full.
According to the case-reports from our clients so far, 99% of above notorious scammers are from Henan (Zhengzhou city) and Guangxi (Guilin city) etc, China at present.
How they TRAP you STEP by STEP ?
First: Use automatic group mailing software to send you attractive offers and inquiries, with created official websites and email boxes. Formal documents, formal address, websites and bank accounts etc, everything seems to be normal.
Second: Invite you to sign a formal Purchase Contract in person in China.
Third: Insist on notarizing the contract and they will use a non-exist notary office to notarize the document, then all the notary fee will be in their pocket.
Fourth: Asking you for ‘kickbacks’ or ‘bribes’ in lot of ‘pretexts’ in China.
Fifth: After they get all those money, they will disappear and replica the scam again.
What are the Countermeasures against these Professional Business Fraudsters?
First: Ask the importer for their Business License and Import License before your departure to China, then checking out their registered information with local officials first.
Second: Book a professional Company Verification or Investigation service from a third-party service company, checking them out before further discussion.
Third: Appoint a local representative and visit them first before your departure to China, they are NOT able to cheat local experts. .
Fourth: Never pay anything before receiving the deposit from the importer.
No matter you’re buying or selling, Due Diligence work is always important in China. Think it over before you pay out even one penny !
Key words:China import fraudster, China fake importer, China import fraud case, fake Chinese importer, Chinese buyers, fake Chinese buyers, China buyer fraud case, China company verification service, importer scam, importer business fraud