The Market Power And Analysis Of It’s Determinant Factors Of China’s Rare Earth Exported To Japan

First of all, this paper analyses the status quo of China’s rare earth production and rareearth trade between China and Japan based on the theory related and literature review, thendraws conclusion as follows: China is the world’s largest rare earth producer, but China’sindustry concentration in rare earth industry is relatively low and the comparativeadvantage of China’s rare earth industry decreased yearly. China is Japan’s biggest sourcecountry of rare earth, China’s rare earth has higher market share in Japan, and Japan isChina’s largest rare earth export market. But, the price of the China’s rare earth exportingto Japan is relatively low.Then, this paper measures the market power of rare earth export from China,European Union and the United States to Japan with the use of residual demand elasticitymodel and come to a conclusion that the market power of China’s rare earth exported toJapan is stronger than the United States’ but weaker than the European Union’s.Meanwhile, this paper screens out9indexes as the evaluation system of the influencefactors of the market power of China’s rare earth exported to Japan based on the theory ofmarket structure and some related research achievements; then, with the use of factoranalysis model, extracts3common factors that impact the market power of China’s rareearth exported to Japan, which are economic and policy factors, monetary factors and tradefactors. And then, by looking at the magnitude of the9indexes under the3commonfactors of the factor loading matrix, we conclude that the determinant factors of the marketpower of China’s rare earth exported to Japan are as follows: China’s policy; Japan’seconomic growth and the RMB exchange rate against the Yen.Finally, after a review of the shortage and influence of current regulatory measures ofChina’s rare earth industry, this paper puts forward from the whole chain of rare earthindustry, if we hope to improve the market power of China’s rare earth exported, not onlyshould we strengthen the management of China’s rare earth export, but also have to strengthen the management of the mining, production and some other links of rare earth.So can we get win-win by keeping the reasonable supply of rare earth in the world andprotecting the ecological environment and resources.