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Japanese Companies Raise Alarm Over China’s Grip On Rare Earth Supplies

Photo by Dominik Vanyi / Unsplash

Japanese companies are stockpiling rare earth materials as Tokyo prepares for potential export restrictions from China amid worsening political tensions, according to regional media reports.

Japan plans to raise the issue at a G7 finance ministers meeting in Washington, with officials warning that any supply disruption would hit key industries such as electronics, automobiles, and defense.

China controls exports of 17 rare earth elements and processes about 90 percent of global supply, giving Beijing significant leverage, analysts say.

Although Japan has reduced its dependence on Chinese rare earths since a 2010 export halt, it still relies on China for roughly 60 percent of its needs. Alternatives exist but are far more expensive and slower to scale.

Beijing recently announced tighter controls on so called dual use exports, which experts believe could include rare earths. Japanese officials and businesses fear a repeat of past supply shocks and are pushing allies to diversify supply chains.

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