China has once again suspended exports of key rare earth elements to Japan, extending a months‑long disruption that is increasingly reshaping global technology supply chains. According to newly released Chinese customs data, no shipments of gallium, dysprosium, terbium or yttrium were sent to Japan in June — a continuation of restrictions triggered by worsening diplomatic relations.
The halt underscores Beijing’s growing willingness to use its dominance in critical minerals as a geopolitical tool. China controls the majority of global production and processing capacity for rare earths, which are essential for semiconductors, electric vehicles, defence systems, and renewable energy technologies. By selectively tightening exports, Beijing is signalling its displeasure with Tokyo while maintaining leverage over industries that rely heavily on these materials.
Although China’s overall rare earth magnet exports recovered last month, shipments to Japan remain sharply restricted. Analysts say this suggests Beijing is easing pressure globally while keeping targeted curbs in place for countries with which tensions are rising. Japan, despite hosting the world’s largest rare earth magnet industry outside China, remains deeply dependent on Chinese raw materials — a vulnerability that is becoming more pronounced as restrictions continue.
The diplomatic fallout traces back to late 2025, when relations deteriorated after Japanese Prime Minister Sanae Takaichi made comments regarding Taiwan. China responded by imposing export controls on several heavy rare earth elements in April 2025, then tightened restrictions further in January and twice more in February, specifically targeting Japanese industrial conglomerates.
Tokyo is now accelerating efforts to diversify supply chains, including partnerships with Australia, the US, and Southeast Asian producers. But experts warn that replacing China’s capacity will take years, leaving Japan exposed to further disruptions if tensions escalate.