Japan’s efforts are proving decisive – the country has begun the process of decreasing its dependence on China’s rare earths by starting imports from Australia. This action is a direct and timely reaction to China’s recent imposition of curbs on rare earth elements they export. These curbs have sent shockwaves through the market internationally. Japan has been taking aggressive efforts to find substitutes for scarce materials that are vital to many emerging and existing technologies. This includes manufacturing capacity for electrifying vehicle fleets and deploying renewable energy systems.
China’s restrictions on rare earth exports have led to a dramatic decline in Japan’s imports from the country, which have now fallen to a five-year low. These curbs are dangerous. They have serious, real-world implications. They have already cut China’s rare-earth magnet exports to the U.S. by 30%. This combined downturn in supply has driven rare earth prices through the roof. At the same time, the US began stockpiling magnet materials, readying itself for expected shortages.
In a very notable step, Sojitz, Japan’s third largest trading house, has started importing rare earth elements. These elements come from the Mount Weld mine in Western Australia. This mine will provide about 30% of Japan’s need for dysprosium and terbium. These two key rare earth elements are vital for many advanced, green technologies. This is a monumental change for Japan. For the first time since the dawn of rare earths, the country has recently bought rare earths from a non-Chinese source, an indicator of its focus on diversifying its supply chain.
China’s mining sector benefits with rare earths prices increase This increase has allowed domestic producers to see improvements in their bottom line—even with significant disruptions in the global markets. Japan’s strategy goes further, highlighted by the upcoming launch of extraction of deep-sea rare earths, with operations scheduled to start next year. This program seeks to produce deep-sea resources that would help even more reduce our dependence on Chinese resources.
Japan, for one, has already cast their eyes on fruitful cooperation with the European Union (EU). Combined, they hope to grow rare earth assets in Greenland, a country with plenty of unexplored possibilities. One senior EU official has gone further, making a passionate defense of this partnership. They underscored the critical importance of diversifying sources of rare earth materials.
Additionally, Japan’s Proterial has rolled out new types of electric vehicle (EV) magnets that avoid using heavy rare-earth metals. If successfully commercialized, this advancement has the potential to drastically reduce the need for conventional rare earth materials. Simultaneously, it encourages sustainable practices in the tech industry.