A subsidiary of China's Baotou Steel Rare-Earth Company will be responsible for implementing a strategic rare-earth reserve plan of Baotou City in Inner Mongolia Autonomous Region, the company said Wednesday.

In a statement to the Shanghai Stock Exchange, Baotou Steel Rare-Earth said the plan would be undertaken by its subsidiary Baotou Steel Rare-Earth International Trading Corporation.

The company did not reveal the cost of the plan, but said the autonomous regional government and the Baotou city government would subsidize 20 million yuan (2.93 million U.S. dollars) for the payment of loan interests.

It said the plan was approved by the autonomous regional government.

The rare earth reserve in Bayan Obo in Baotou accounts for 75 percent of China's total reserve.

Baotou Steel Rare-Earth's current market value stood at 19.3 billion yuan. It is one of the two Shanghai-listed companies under Baotou Iron and Steel, one of China's largest steel makers. The other is Baotou Steel Union.

Local governments have been supporting a vision to build Baotou into a world-class rare earth industrial base, as well as the establishment of a rare earth reserve mechanism to stabilize prices.

China is now the world's largest producer, exporter and consumer of rare earth resources. China's reserves total 80 percent of the world's discovered rare earth resources, according to the Ministry of Industry and Information Technology.

Rare earth, which include minerals such as dysprosium, terbium, thulium, lutetium and yttrium, is widely used in the fields of electronics, aviation, atomic energy, and mechanical manufacturing.