As part of ongoing China-Japan tensions over Taiwan, including Beijing's recent ban on dual-use exports like rare earths, Japanese firms are evaluating supply chain effects, which are not expected until next month at the earliest.
Following China's export prohibition last week on over 800 dual-use items to potential Japanese military end-users—a move linked to Taiwan disputes—companies are gauging repercussions from the rare earth inclusions, per a person familiar. Effects are unlikely before next month. These curbs build on tighter controls since April 2025 amid U.S. trade frictions. State media China Daily reports Beijing considering stricter export license reviews for medium and heavy rare earth products to Japan. Essential for electronics and autos, rare earths prompt supply chain worries, though immediate disruptions are contained. This highlights deepening economic strains, complementing Japan's diplomatic responses like South Korea outreach and G7 coordination.