MediumV Technology Geopolitics & AI4 November 2026, Wednesday
Japan criticises Chinese rare-earth curbs at APEC ahead of Shenzhen summit
Japan's industry minister, Ryosei Akazawa, criticised China's rare-earth export restrictions at an online APEC ministerial meeting on 3 November; the Foreign Ministry released the remarks on 4 November. In September Japan received only 4 tonnes of China's 110.1 tonnes of yttrium oxide exports.
According to Jiji, reporting on 4 November, Akazawa objected to arbitrary restrictions on critical-mineral shipments that could sever supply chains. Foreign Minister Toshimitsu Motegi also warned against protectionism and economic coercion at the 3 November meeting. The meeting's 2 co-chairs, Commerce Minister Wang Wentao and Foreign Minister Wang Yi, stressed free trade and the multilateral system. China will host APEC leaders in Shenzhen on 18–19 November.
The scale of the restriction shows in the 2026 customs data. According to Chinese customs, 14.1 tonnes of yttrium oxide went to Japan in January–May 2026, 97.7% below the 605.3 tonnes of a year earlier. Shipments were zero in August and 4 tonnes in September. Argus puts the price of yttrium oxide at 1,150 dollars per kilo outside China and 9 dollars inside it.
Yttrium, subject to licensing since April 2025, is used in jet-engine turbine coatings and in heat-resistant coatings for semiconductor manufacturing tools. Börsen-Zeitung reported on 20 October that a Japanese government official warned of shortages by the end of 2026 if Beijing does not change course. Lynas does not expect its first yttrium output before early 2028, so no alternative will come on stream within 14 months.
Talay assessment
Bottom line
Tokyo has taken the rare-earth restrictions to a multilateral forum 2 weeks before the Shenzhen summit. Criticism alone will not change Beijing's licensing practice; yttrium flows to Japan stood at just 4 tonnes in September. Unless the summit yields a licensing gesture, there is a strong chance that shortages reach the semiconductor-equipment and aviation supply chains by the end of 2026.
Likely effects
- Semiconductor equipmentNegative1–6 months
Without yttrium for heat-resistant coatings, Japanese equipment makers will draw down inventories faster and accelerate the search for substitutes.
- Aviation supply chainNegative1–6 months
Japanese components that depend on jet-engine coatings also feed the US defence supply chain; shortages could hit delivery schedules.
- Price gapNegative6 months+
The gap between 9 dollars inside China and 1,150 dollars outside it keeps producers outside China at a cost disadvantage.
Possibilities, ranked
- 1Selective licensing persists55%
Beijing keeps licensing yttrium to Japan at minimal levels, and the summit produces no concrete step.
Watch: Japan's share of China's November yttrium oxide exports in customs data
- 2Limited gesture at the summit30%
On the sidelines of the Shenzhen summit, Japanese buyers receive a modest increase in licences.
Watch: Japan–China contacts at the 18–19 November APEC summit
- 3Restrictions tighten15%
Beijing adds new Japanese entities to its export control list.
Watch: Export control list announcements from China's Commerce Ministry
Probabilities are calibrated judgement based on the sources, not measurement, and are revised as new information arrives. Not investment advice.
Market reaction
Indicators affected
- Yttrium to Japan (Sept)▼ 4 tonnes
- Jan–May decline▼ −97.7%
- Price outside China▼ $1,150/kg