Rare Earths prices increased 12% over the Chinese May day holiday, according to Lynas Corp and its Mount Weld rare earths composition price passed through the $10/kg mark by jumping from $9.43/kg to $10.58/kg in one week. The company also noted that Baotou mixed rare earths carbonate production has been halted due to water issues and in Sichuan region, rare earths mining and concentrate production have been stopped by local government.In Baotou, Lynas understands the water issues relate to the Government authorities’ tighter supervision to protect the water system of the Yellow River from contamination associated with waste water discharge from local mixed rare earths carbonate plants. The mixed rare earths carbonate from Baotou is the feed for the majority of the rare earths separation plants in China. Lynas estimates that approximately 20,000 t/y of rare earth oxide (REO) may be affected by the shutdown.This supply constraint has been compounded by reports that the Sichuan rare earths regional production has been stopped by the local government due to industry restructuring issues within the region. Lynas understands that the local government had planned to consolidate the small mining and concentration operations into four groups within this region; however it appears this plan has stalled. The consequences appear to be a local government order to cease all production. Sichuan accounts for approximately 25,000 t/y of REO. The actual extent of the shutdown is not yet known and the duration of the shutdown is uncertain.