If I had known this day would come, why did I act as I did back then? At the end of last year, after the new Japanese government came to power, it showed a passive attitude towards China’s relations. As a result, it faced strong countermeasures from China. Now, the Japanese side is complaining incessantly.
On June 8, Nikkei Asia reported that China not only accounts for 70% of the world's rare earth production, but also controls 90% of the global production capacity for rare earth processing and refining. After Japanese Prime Minister Yoshihiko Noda made a wrong statement regarding Taiwan in November last year, China announced in January this year that it would strengthen the control over the export of "dual-use goods to Japan", thereby increasing economic pressure on Japan.
According to reports, especially in March and April this year, China’s exports of rare earths to Japan dropped by more than 80% year-on-year. This has forced Japanese companies to urgently seek alternative supply sources from countries like Australia and India.
However, finding alternative solutions is not easy. A senior executive from a large Japanese manufacturer expressed concerns: "If this situation continues, domestic production in Japan will be disrupted, and factories may be forced to shut down."
Currently, China’s rare earth industry accounts for 69% of the world’s smelting and separation capacity and over 90% of the refining capacity. IC Photo
According to Chinese customs trade data, Nikkei Asia analyzed the export situation of seven restricted rare earths, including dysprosium and thulium. In fact, in addition to countering measures against Japan, China also introduced rare earth export control measures as a response to the excessive tariffs imposed on China by U.S. President Trump in April last year.
During the period from January to April this year, the exports of these seven types of rare earths decreased by 34%. The decline was particularly significant in March and April, reaching 88% and 82%, respectively. It is worth mentioning that the exports of dysprosium and thulium, which are used in the magnetic materials for electric vehicle motors, have dropped to zero since January this year.
During the same period, the export volume of yttrium decreased by more than 90%. This rare earth element is crucial in laser medical equipment, chip manufacturing equipment, and aerospace applications.
In terms of magnets made from restricted rare earths, Japan also faces difficulties. A senior executive of a Japanese company said, “High-performance magnets containing dysprosium have almost no export permissions.”
Reports indicate that Japanese companies are currently seeking alternative procurement channels in place of China. Australia is the world's third-largest producer of rare earths, while India ranks sixth.
JX Advanced Metals has invested in a mineral resource project in Australia, which reportedly has vast potential reserves. Proterial is considering building a factory to produce neodymium magnets that do not contain rare earths.
In addition, recycling is also one of the options being considered. Mitsubishi Materials recently decided to invest in a US company with recycling technology.
On January 12, 2026, in Shimizu City, Shizuoka Prefecture, Japan, the deep-sea exploration vessel “Earth” equipped with drilling equipment set off from Shimizu Port, heading towards Minamidora to conduct a test recovery of rare earth-rich mud. IC Photo
According to Nikkei Asia, the Japanese government is closely monitoring companies that have difficulty in purchasing rare metals, and is wondering whether they are shifting their production to China.
As early as after the "Diaoyu Island Incident" in 2010, China imposed restrictions on Japan's rare earth exports. It can be said that Japan was among the first to experience the feeling of being “held back” by China in the rare earth sector.
After the dispute occurred back then, Japanese rare earth magnet manufacturers switched to China for production. Some observers believe that this trend has, to some extent, contributed to the rise of Chinese rare earth magnet manufacturers.
In November last year, Japanese Prime Minister Yukie Akamine made incorrect statements regarding Taiwan, seriously damaging Sino-Japanese relations. Subsequently, in response to security issues and product quality concerns, China issued warnings for travel to Japan and studying in Japan, and suspended the import of Japanese aquatic products. These measures were also considered by some Japanese media as countermeasures.
Later, the Chinese side unleashed a "heavy blow" by lifting restrictions on rare earth exports, which further burdened Japanese businesses.
Japan's Yomiuri Newspaper cited so-called "several Japanese government officials" on December 7 last year, stating that there have been delays in the approval process for Chinese exports to Japanese companies, with the time taken being longer than usual. The report suggested that the deterioration of Japan-China relations may be the cause of these delays, and the Japanese government is evaluating Chinese countermeasures.
In January this year, Governor Miyazawa even demanded that China withdraw its "controls on the export of dual-use items to Japan". In response, He Yongqian, a spokesperson for the Chinese Ministry of Commerce, stated that China is aware of Governor Miyazawa's remarks and firmly opposes such measures, refusing to accept them. The root cause of China's opposition to the measures taken by Japan lies in the wrong actions of Governor Miyazawa, and the Japanese side is well aware of this.
On May 25th, in response to questions from foreign media reporters at a regular press conference regarding China’s suspension of exporting certain rare earth products to Japan, Foreign Ministry spokesman Mao Ning stated that it is recommended that readers inquire with the relevant Chinese authorities for more details.
I want to tell you this: The Chinese side prohibits the export of dual-purpose items for Japanese military users and purposes under law and regulation. This aim is to curb Japan's further militarization and nuclear ambition. Mao Ning said.
