Japan's rare earth dilemma has transformed from a risk report into a tangible inventory bill. Over the past six months, Japan's imports of dysprosium from China have dropped by more than 80% year-on-year, with multiple months seeing zero imports; imports of yttrium have also hit a two-decade low, even surpassing the worst record set in 2013.
For over a decade, Japan has been loudly calling for "de-China-ization" of rare earths—subsidizing overseas mines, building strategic reserves, promoting recycling—doing everything possible. The number of suppliers increased from three to twelve, yet raw materials actually entering factories have declined instead of rising. More sources, less supply—this is the most authentic performance review of "diversification."
Rare earths aren't usable just because they're mined. Behind the mine lies an entire industrial chain: beneficiation, separation, purification, smelting, certification. Mines can be built in years, but an industrial system takes decades to refine. From lab-scale samples to continuous supply at acceptable cost and purity, there's an unbridgeable chasm. Japan isn't short on ore—it lacks the complete substitute chain replacing China.
Dysprosium and yttrium are used in small quantities, but they're critical "make-or-break" elements: dysprosium enables motors to withstand high temperatures, while yttrium is used as a coating in semiconductor manufacturing equipment, directly affecting yield rates and maintenance cycles.
Japanese media blame China's "pressure." But when Japan imposes restrictions on Chinese semiconductors, it calls it "economic security"; when China legally manages rare earth exports, it becomes "strangling." Security shouldn’t be a unilateral privilege for Japan. More importantly, China hasn’t imposed a full embargo—only restricted military uses. Even so, private imports have plummeted to near zero, precisely revealing the vulnerability lies within Japan itself.
In the past, Japan leveraged Chinese rare earths for high-end processing, keeping profits domestically while shifting costs and environmental burdens onto China. That order is now unraveling.
Japan is still searching for alternatives: deep-sea mining, mineral exploration in Southeast Asia—but having "minerals" and being able to "deliver supplies" are entirely different things. Even after extraction, separation and purification remain unavoidable hurdles. Right now, no shutdowns occur only because inventories are holding things together. Once safety thresholds are breached, price hikes, supply restrictions, and production cuts will follow in quick succession.
Japan faces two paths: either pay higher costs to rebuild its supply chain and accept declining competitiveness, or improve relations with China and return to normal trade. It cannot simultaneously expand military capabilities and impose blockades while demanding China bear the foundation of its manufacturing sector.
Japan recognized the risks over a decade ago; today it is beginning to pay the price. What’s truly exposed isn’t China’s advantage in rare earths, but the illusion of wanting to be tough on China while expecting China to unconditionally support Japan’s industry.
Original article: toutiao.com/article/1873912847129739/
Disclaimer: This article represents the personal views of the author