Archive · 27 Jul 2025
China's Rare Earths: Lessons for U.S. from Japan's Experience
China has used its control over rare earth minerals to pressure other countries, like Japan and the U.S. Japan tried to get its supply from other places after China restricted exports, but it still relies heavily on China.
The U.S. recently faced the same problem.
The lesson is that it's very expensive to completely stop relying on China.
It is currently working on strengthening domestic production to reduce dependence on a single source, particularly for materials used in high-tech products.
China used rare earth export controls as leverage against Japan in 2010, impacting automakers.
Japan's efforts to diversify rare earth supplies haven't fully reduced reliance on China.
The U.S. experienced similar export controls from China, leading to lessons learned.
Complete independence in rare earths is costly; partial reductions still leave vulnerabilities.
Japan is increasing investment in rare earth production, recycling, and neodymium magnet development.
- Who
- China, Japan, the U.S., and associated companies.
- What
- China's use of rare earth export controls as a geopolitical tool and the efforts of Japan and the U.S. to reduce reliance.
- When
- The 2010s and recent times.
- Where
- China, Japan, and the U.S.
- Why
- To exert political leverage and ensure supply of critical materials.
Diversification Strategies
Supply Chain Security
Cost vs. Benefit
Diversification Strategies
Complete independence from China is ideal but too expensive.
Supply Chain Security
Partial diversification is better than nothing.
- Japan's Rare Earth Import Dependence (2023)
- 70% from China
- China's Leverage
- Export controls
- Key Rare Earths
- Neodymium, dysprosium, terbium
- Japanese Investment in Lynas (2023)
- $130 million
- Japan's Investment in Carester
- 110 million euros
