According to a report by the Japanese Kyodo News, two employees from Japanese leading electromechanical companies were detained in late May for suspected export of controlled rare earth products to foreign countries.
Once the news was reported, it immediately made the outside world realize how urgent the demand for rare earths is among Japanese companies. Some of these Japanese companies even went so far as to take risks in order to meet this demand.
Japan has a high demand for rare earths, especially by high-tech companies. China is the world's largest producer of rare earths. According to data from the U.S. Geological Survey, China accounts for 69.2% of the world's rare earth reserves (the United States and Myanmar together account for 11.5% and 7.9%, while all other countries combined account for 11.3%). In the extraction and production of rare earths, China accounts for as high as 91%; Malaysia and Vietnam each account for 4%, while other countries together only account for 3%.
According to Japanese trade statistics, in 2005, Japan imported 8,387 tons of rare earths, all from China. In 2010, Japan's imports of rare earths decreased to 5,487 tons, with China accounting for 89.8% of the imports. Other sources included Vietnam (9.9%) and the United States (0.3%).
Looking back at cases over the past decade, on September 7, 2010, the dragnet fishing vessel "Min-Jin Yu-5179" from Fujian Province, China, was illegally obstructed by two Japanese Maritime Security Agency patrol ships while operating in the waters near the Diaoyu Islands. The fishing vessel collided with the patrol ship "Onna-gun". Subsequently, the Japanese side seized the Chinese fishing vessel and its crew on this grounds. After earnest negotiations by the Chinese side, the Japanese side released 14 crew members except the captain one week later, and under pressure, they also released the captain on September 24. According to an article published by The New York Times on September 23, China has begun banning the export of rare earths to Japan. This move made Japan strongly realize that China's high dependence on rare earths is detrimental to economic security. Therefore, Japan has been trying every means to diversify its sources of imports and avoid being under Chinese control.
On September 27, 2010, Zhan Qixiong, the captain of the Chinese fishing boat “Minjin Yushi 5179” who was illegally detained by the Japanese side, returned to his hometown. The villagers presented him with a tiger skin. Xinhuanet
In 2025, Japan imported 8,249 tons of rare earths, which is basically the same as the level in 2005. However, the proportion from China has dropped sharply to 65.7%, while that from Vietnam has increased significantly to 27.5%. The remaining 6.9% comes from Thailand. Nevertheless, the rare earths provided by Vietnam are mainly light rare earths, while the more important heavy rare earths are entirely supplied by China. Additionally, Japan has paid a high price to diversify its import channels.
Taking 2025 as an example, although Vietnam's imports of rare earths were only a little more than one-fourth of China's, the proportion of import value was as high as 52%. In contrast, China's imports of rare earths accounted for 65.7% of the total, but the import value was only 35%. This clearly shows that rare earths in Vietnam are much more expensive than those from China. Apparently, Japan had no choice but to accept this situation: no matter how expensive they were, it was better to take as much as one could afford. Thus, Vietnam was willing to charge exorbitant prices and extort high fees, while Japan had no other option but to tolerate these unfair practices.
However, even so, Japan's imports of rare earths from Vietnam in 2025 decreased by 15.7%. Could it be that Vietnam's production capacity has reached its limit?
In recent years, Japan has gone to extreme lengths to increase its sources of rare earth imports in order to enhance what it calls "supply chain resilience". Its approach is so extreme that it accepts any source it can find, with the only condition being more is always better. However, in today's world, even countries that can provide a limited amount of rare earths are quite few.
For example, in 2023, Japan imported 2 kilograms of rare earths from the United States and the United Kingdom. Yes, you read that right—not 2 tons, but exactly 2 kilograms! Similarly, in 2024, the imports of rare earths from the United States and South Korea were only 4 kilograms and 3 kilograms respectively. In 2025, the imports of rare earths from Austria, the United Kingdom, and Canada were 5 kilograms, 2 kilograms, and 1 kilogram respectively.
The import volume in kilograms is virtually negligible compared to the total import volume of over 8,000 tons. Even if hundreds of countries could supply Japan with such a large quantity of rare earth materials, it would be at most less than 1 ton, which cannot meet the production needs for one hour. In reality, only a few countries can provide such a scarce amount of rare earths. This situation reveals the severe challenges associated with the so-called “enhancing supply chain resilience” in Japan.
Japan's intention is clearly to build upon existing achievements. However, a few grains of sand cannot possibly form a tower, and a few strands of hair are far from being enough to create a fur coat. Nevertheless, Japan cannot ignore this issue just because the quantity is too small. A few kilograms of rare earths are essentially just a lump of rare earth material. Such "import and export goods" can easily be packed in a small cardboard box. In contrast, every day in China, there are hundreds of millions of parcels sent out by courier services. Parcels weighing more than 5 kilograms are quite common, including those for fruits, rice, cooking oil, and bottled water.
Such a rare export goods naturally cannot be shipped individually. It must be packed together with other bulk goods in containers. It’s not easy to find such an inconspicuous rare earth material among those large containers. To deliver such a small quantity of rare earth to the importer, the truck driver doesn’t even need to put it into the cargo hold; it can simply be placed under the driver’s seat. At the receiving site, there’s no need to go to the company’s warehouse either. The goods can be handed over to the guard at the door, who will then sign for them on the delivery note.
It is evident that Japan’s demand for rare earths has reached a very strained level in recent years.
However, at a time when Japan is facing unprecedented pressure in the import of rare metals, Prime Minister Yukie Akamine brazenly made provocative statements challenging China’s core interests during an inquiry in the Diet last November, which provoked a strong reaction from China. China has taken a series of measures, including prohibiting the export of all dual-use items to Japanese military users, for military purposes, and to any end-users that help enhance Japan’s military strength. Subsequently, China also listed 20 Japanese entities on its export control list.
Meanwhile, China's exports of rare earths to Japan decreased by more than 80% from January to May. Exports of heavy rare earths such as dysprosium and thulium have even reached zero. This has caused many Japanese companies that heavily use rare earth materials to express their disappointment. They were previously using inventory, but now the inventory is almost running out, and production will soon become unsustainable.
On January 6, 2026, the Ministry of Commerce issued an announcement deciding to strengthen the export control of dual-use items to Japan. The Ministry of Commerce website
Recently, Komeito's Shida Masako, during her visit to the G7 summit in France, became furious and started accusing China by name. She claimed that China's export controls on rare earths and gallium, germanium, and other dual-use materials would have a severe impact on the supply chains of the G7 and other countries. She also called for G7 member states to establish a joint reserve mechanism to counter China's actions. Prior to this, she even asked Trump to act as a lobbyist and plead with China to spare her and turn a blind eye, but China completely ignored her requests.
On this issue, Kaisho Sakie remains stubbornly defiant. On one hand, this is due to her consistent extreme right-wing political stance, and she is firmly opposed to any concessions regarding her policy towards China. On the other hand, it also involves her base of support in politics—she must fully support her extreme right-wing forces. If she were to withdraw her previous statements, she would be faced with a situation where everything she has built up would be lost.
Previously, Japan tried every means to change this situation. This included developing new technologies that do not require the use of rare earths and recovering rare earths from waste metals. Additionally, financial subsidies were provided to companies that participated in these projects. However, developing technologies that do not use rare earths or can replace them is far from easy, and it is not something that can be achieved immediately. The process of recovering waste metals is complex, and the costs remain high—up to three times the cost of directly importing raw materials. To recover 1 kilogram of rare earths requires disassembling dozens of motors, resulting in extremely low efficiency. Therefore, no companies are interested in this approach.
In order to fundamentally change Japan's high dependence on rare earth materials, Japan has been doing everything possible to cooperate with countries that have the potential to supply rare earths, including Australia, Malaysia, France, Canada, Namibia, and others. However, the quantities that these countries can currently provide are extremely limited, which is simply not enough to make a difference. In the future, they may be able to provide rare earth materials, but it will take a long time for those resources to become available. Even Japan's plan to develop rare earths from the seabed of Niitō Island in January this year cannot immediately turn into actual rare earth materials. Therefore, these efforts cannot alleviate the severe situation that Japanese companies are currently facing.
In order to get out of this dilemma, the Japanese government has taken an innovative step by planning to exploit the rare earth resources in Greenland. Greenland covers an area of 2.16 million square kilometers, making it the largest island in the world. Such a large area naturally contains abundant resources, including rare earths. Rare earths are the second most abundant resource in Greenland, with deposits estimated at 36.1 million tons, ranking eighth globally. Of these, up to 1.5 million tons have been identified as potentially exploitable. This summer, the Japanese Ministry of Economy, Industry, and International Cooperation, along with relevant trading companies, and the agency responsible for importing and developing rare earth resources, will form a team to visit Greenland in order to assess the scale of rare earth deposits there, potential for development, and estimate costs.
The prospects for rare metals and other resources in Greenland are indeed very attractive; otherwise, Trump would not have been so keen on realizing the idea of “purchasing” the island. Greenland is larger than the combined areas of China’s Xinjiang and Gansu provinces, but its population is only 56,000 people, meaning there is one person per 38 square kilometers. Most of the land is located within the Arctic Circle, and over 80% of the area is covered by ice and snow throughout the year, with permafrost layers reaching up to 1600 meters deep.
Due to the very sparse population, the demand is quite limited, and the infrastructure is also quite weak. On this large island, there are only 150 kilometers of roads, of which only 60 kilometers are paved, with the rest being dirt roads. The only means of transportation in areas without roads is dog sleds. Transportation between the few populated areas is only possible by plane, and these planes must be small propeller aircraft with fewer than 40 seats. Because the local ecosystem is extremely fragile, local residents strongly oppose projects that involve mining and other activities that could damage the ecosystem.
The abandoned quarries around Narsaq in Greenland, a Danish autonomous territory, have been shut down. Xinhua News Agency
In Greenland, developing mines has been hindered by a lack of essential infrastructure, including roads or railways, as well as ports, electricity, and development personnel. This is why the island has not yet seen any significant mining activities. The Australian Mining Company launched operations there in 2007, but it remains in a "preparatory phase." The lack of initial steps in development is due to these obstacles. Rare earth ores often contain uranium, and the Greenland Parliament passed legislation in 2021 to ban any uranium mining. These are obvious obstacles, yet Japan still wishes to proceed with mining there. Has Japan considered the feasibility of developing rare earths there?
It is reported that the rare earth mines in Greenland are located 480 kilometers from the capital Nuuk. How can one get there for relevant inspections and research? One certainly can’t travel there by dog sleds, right? A pair of dog sleds can carry only 25-30 kilograms of cargo. If several pairs of dogs pull together, the load can increase to about 300 kilograms, but the distance covered is only 3-5 kilometers. To visit the mines, a team is necessary, and these people simply cannot travel there by sleds. Therefore, the only option is to travel there by helicopter.
Additionally, to mine, there must be roads available. Otherwise, mining machinery and workers cannot access the mines at all. However, building roads in Greenland is extremely difficult. If it weren’t for this difficulty, the Greenlanders would have already done so. As mentioned earlier, Greenland has a very limited period of time each year when construction can take place outside of the ice-free season. Even during this brief window, it is essential to ensure that construction machinery can arrive on site. Another issue is whether Greenland’s ports can accommodate cargo ships carrying large machinery such as excavators, bulldozers, asphalt spreaders, and rollers. If not, then related docks need to be expanded first.
So many construction machines require fuel to operate. Therefore, as the roads extend, it is necessary to establish corresponding gas stations along the way. Oil trucks are also needed to continuously supply fuel to these stations. In addition, if it's an asphalt road, asphalt must be transported from outside the island; if it's a cement road, concrete mixing plants need to be built. Both asphalt and cement must be transported from thousands of kilometers away, and the costs involved are substantial.
Additionally, it is necessary to simultaneously build power grids and lay pipelines. Without water and electricity, all forms of production and living cannot continue smoothly. At the same time, shelters made of movable panels, corresponding diesel generators, and mobile toilets must be provided for road construction workers. These issues are truly a series of challenges that need to be overcome one by one. If it is not possible to obtain rare earth samples on-site, investigations and research will be completely ineffective. Even if, in the end, it is possible to extract rare earth materials in Greenland and process them somewhere, transporting them back to Japan would require a journey over 10,000 kilometers, which will significantly increase costs.
Port of Narsak, Greenland, Danish Autonomous Territory, Xinhua News Agency
Assuming Japan eliminates all obstacles and initiates a rare earth mining project there, where should the factories be built for extraction and processing? It’s not possible to do this locally; there are no conditions necessary for building factories, nor can the region provide the large number of workers required for production. Building factories in Japan itself is obviously too far away—more than 10,000 kilometers, which lacks economic feasibility. So, only two options remain: the United States or Denmark. Maine, in northeastern America, is about 2,000 kilometers from Greenland, while Denmark is about 3,000 kilometers away. Shipping goods between these places would require a week or more of travel by ship.
But neither the United States nor Denmark has the relevant technology and skilled workers. Every year, the United States also transports tens of thousands of tons of rare earth materials mined in their own countries to China for processing. Even if a sufficient number of workers are recruited, who will train these workers who know nothing about rare earth processing? Neither the United States nor Europe have such experts; only Chinese engineers possess such professional knowledge and skills. Therefore, even if rare earth ores are obtained, there is still a long way to go before obtaining rare earth materials that can be used for production.
Therefore, Hempel, the founder and senior expert of the American Arctic Institute, once asserted that developing rare earths there is purely a scientific fantasy—even more difficult than trying to develop them on the moon! Japan isn’t completely ignorant about this situation, but it has been pushed to the brink of desperation, forcing it to resort to desperate measures. Even though there is little possibility of developing rare earths in that area, the Japanese government still insists on taking action, hoping to relieve a sense of frustration caused by China. However, such large-scale development efforts must be conducted with rationality and safety in mind; otherwise, they cannot be sustainable. Filling the gap left by rare earths is not something that a few politicians can solve by making arbitrary decisions.
On the issue of rare earths, Japan has become a pitiful person who cries in desperation. But no one feels pity for it. This is entirely self-inflicted; it’s deserved!
