Fears over a global shortage of precious rare earths metals are mounting, as production in China slows amid a national crackdown on illegal miners.

This month 155 rare earths businesses, almost all on the mainland, launched a national industry association, after the United States, the European Union and Japan filed a complaint in March to the World Trade Organisation, accusing China of unfairly limiting its exports of rare earth elements.

The China Rare Earths Industry Association will assist in communicating with foreign companies in the event of trade disputes and help monitor the industry, which has seen rampant illegal mining and serious environmental damage, says its deputy secretary-general, Chen Zhanheng.

“The amount of illegally mined rare earths in the southern regions has been about twice the volume of mining officially permitted by the government in recent years,” he said.

Officials from Japan, the US, European Union and…