Rare Element (REE), Molycorp (MCP), China Shen Zhou (SHZ), Avalon (AVL) Mixed on China Rare Earths Strategy

The announcement by China that it's going to consolidate its rare earths sector has companies such as Rare Element Resources Ltd. (NYSE:REE), Avalon Rare Metals (NYSE:AVL), Molycorp (NYSE:MCP) and China Shen Zhou (NYSE:SHZ) mixed in response to the news.

A statement from an executive meeting of the State Council said, "China should accelerate industrial upgrading and technological innovation to protect the environment and save resources."

To attain those goals, China said they'll "maintain rational production and inventory control, make better use of domestic and overseas markets and resources, and have active international cooperation for a healthy and sustainable development."

Xinhua added, "authorities would carry out special campaigns to crack down on illegal mining activities to maintain order in production, further consolidate the industry and promote technological innovation, said the document."

Rare earths producers outside China are working feverishly to boost or enter into production phases in response to China's recent announcement they're cutting back on rare earths exports by about 35 percent.

Some of that is complicated by what rare earths are in the projects each company owns. Some are more profitable than others, serving various markets.