Stimulating the production and consumption of rare earth metals in the Russian economy
Abstract
Relevance. Rare earth metals (REM) play an increasingly important role in the modern economy, particularly in the production of high-tech goods. The study aims to propose measures to improve state policy for stimulating the production and use of REM in the Russian economy.
Research Objective. The study aims to compare the growth of prices for REM ores and for products manufactured from them, identify discrepancies in growth rates, analyze the underlying causes, and develop measures to address them.
Data and methods. Statistical and econometric methods were applied to examine price dynamics for manufactured goods and REM ores across the Russian economy as a whole and in five key regions engaged in ore and concentrate extraction.
Results. Domestic prices for REM ores have grown at a significantly faster rate than prices for manufactured goods. This outcome is mainly explained by the principle of equal profitability in raw material supply for export and the domestic market, along with the persistent weakening of the ruble, which pushes up domestic ore prices.
Conclusions. If domestic raw material prices are kept lower than world prices, this could give the Russian economy a strong incentive to expand high-tech production. To achieve this, one possible measure is to restrict raw material exports and limit imports of manufactured products, which, given the inoperative WTO court, would not entail negative consequences for Russia.
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DOI: https://doi.org/10.15826/recon.2025.11.3.015
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