Since 2010, China's regulations on the real earth business integration and export limitation have taken into effect, but haven't succeeded yet. Now, China's domestic real earth production is overcapacity, the capacity utilization is under 40%. Although the quota-control policy is applied to real earth export, the real earth smuggling has broken through the limitation. Meanwhile, the overseas real earth buyers are looking for the alternative resource locations, which undermines China’s aim at rising the real earth international price. Based on the chaos of domestic real earth industry, the government’s regulations are as something of a damp squib.