China cuts rare earth exports to Japan by half, leaving Japan with no choice but to turn to scrap recycling
In the first half of this year, China's export of seven controlled rare earth materials to Japan dropped by 51% year-on-year, while global exports declined by only 16% during the same period. The 35-percentage-point gap is not general regulation—it's targeted pressure. The hardest-hit are dysprosium and terbium; electric vehicle motors simply cannot function without them. Exports to Japan in the first half of the year fell to zero. In June alone, exports to Japan plummeted by 81%, and even yttrium—essential for semiconductors and aircraft engines—dropped to zero.
Over 70% of Japan’s rare earth imports come from China, and its reliance on China for heavy rare earths approaches 100%. A sustained supply cutoff would erase 2.6 trillion yen of Japan’s GDP.
Under such circumstances, Japan has run out of options.
Last month, Mitsubishi Electric officially announced it would launch large-scale recycling of discarded air conditioner outdoor units, extracting heavy rare earth permanent magnet materials from compressors. A single commercial air conditioner compressor can yield 100 to 300 grams of heavy rare earth-containing permanent magnets. The Japanese themselves are candid, joking that they’ve now reached the point where they’re literally forced to scavenge garbage.
But dismantling air conditioners won’t solve the bigger problem. Japan consumes about 20,000 tons of rare earth magnets annually. Even if every decommissioned air conditioner in Japan were recycled, the total recovery would be only around 200 tons per year—less than 1% of total demand. All the effort amounts to a drop in the ocean.
The most painful part isn't the cutoff itself, but China's occasional allowance—a lifeline held just tight enough to keep hope alive.
Insiders reveal that while maintaining strict controls, China occasionally issues partial export licenses. When Beijing learns that a supply disruption could lead to shutdowns at Japanese auto plants, it will cautiously offer a little breathing room. This tactic doesn’t fully strangle the target—it keeps them dangling, forever uncertain.
Japanese companies can neither completely abandon their reliance on Chinese supply chains nor escape constant anxiety over whether the next shipment will arrive. Meanwhile, they’re pressuring the Japanese government through business channels to prioritize relations with China.
This strategy is far more sophisticated than simple export restrictions.
Original source: toutiao.com/article/1873302778404871/
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