BEIJING/MELBOURNE, July 20 (Reuters) - China's imports of rare earths from No.2 supplier Myanmar have surged this year, customs data showed on Thursday, as the world's biggest processor of the minerals steps up production for its growing automotive and wind energy sectors.
China imported 34,241 metric tons of rare earth ores and compounds from its southeast Asian neighbour in the first six months, 70% more than the second half of 2022, and nine times more than the first half of 2022.
Myanmar has become China's biggest supplier of heavy rare earths in recent years, providing about 40% of its supplies of minerals including dysprosium, yttrium and terbium, according to Canada-based Adamas Intelligence.
Trade was hampered by China's strict COVID controls along its borders, but monthly shipments jumped in December 2022 when China abandoned most of its COVID measures, and trade has remained high throughout this year.
Shipments from China's top supplier of rare earths, the United States, meanwhile fell 21% in the first half of this year compared with last, to 38,236 tons.
China dominates global rare earth processing, which turns the minerals into batteries and magnets critical to electric vehicles and other sectors.
Increasingly a concern to Western nations, Chinese miners are developing new overseas supplies to maintain their grip on the global market, say analysts.
High prices have incentivised capacity and infrastructure investment in Myanmar, leading to a surge in production, said Dylan Kelly, head of research at Sydney-based fund Terra Capital.
Another neighbour, Laos, also sent some small shipments to China this year, the data also showed.
But falling rare earth prices could slow the trend, said Kelly.
Prices for rare earths hit decade highs at the start of 2022 amid supply chain disruptions during the pandemic, but have since sunk to the lowest in three years on rising supply and softer demand.
"As prices have fallen, you'd expect that surge in production may start to wind down," he said. (Reporting by Beijing Newsroom, Melanie Burton and Dominique Patton; Editing by Sharon Singleton)
