Nature-positive rare earth governance: Japan's strategy in a China-dominated system
Year: 2026
Type: article
Abstract: Rare earth elements (REEs) are critical to decarbonization and digital infrastructure, yet their supply chains exhibit pronounced structural asymmetry and highly uneven environmental footprints, with China controlling roughly 70% of global mine output and around 85–90% of refining capacity. This article reviews Japan’s rare earth security strategy as a resource-poor but technology-intensive economy along three axes: (1) the geological potential, environmental trade-offs and realistic development role of deep-sea REY-rich mud within Japan’s exclusive economic zone, especially deep-sea deposits around Minamitorishima Island; (2) the structural divergence between China’s integrated, volume-oriented “mine-to-magnet” system and Japan’s specialization in high-purity, high-value segments, including their respective environmental performance; and (3) portfolio diversification through Australian and Southeast Asian partnerships, domestic recycling, and ESG- and nature-positive–oriented governance tools.Methodologically, the paper employs a qualitative three-scenario framework for 2030–2035 (conservative, central, ambitious), calibrated to recent USGS and IEA assessments, to explore how non-Chinese capacity expansion, demand-side innovation and environmental regulation could reshape Japan’s exposure to both supply disruption and environmental risk. The analysis shows that, although Minamitorishima Island’s deep-sea deposits are geologically exceptional, substantial techno-economic and ecological uncertainties mean they function primarily as a long-term “strategic buffer” rather than a near-term substitute for Chinese onshore supply. From an environmental perspective, deep-sea options could avoid some land- and community-related impacts of terrestrial mining but introduce high-uncertainty risks to poorly understood deep-sea ecosystems.Japan’s comparative advantage instead lies in high-purity separation, heavy-rare-earth-lean magnet design, and advanced circularity, leveraged through alliances and standards to substitute volume with technology, efficiency and governance. In the central scenario, China’s share of global mining moderates to around 50–55% by 2035, allowing Japan to move from a China-centric import profile towards a more diversified supply matrix that includes secondary sources and non-Chinese terrestrial projects with improved ESG performance, while China remains the dominant single producer even in ambitious scenarios. For resource-poor industrial economies, the findings suggest that resilience is more plausibly achieved not by trying to replicate China’s scale, but by combining diversification with systematic reductions in the environmental intensity of rare earth use, and by embedding nature-positive principles into supply-chain governance and producer–consumer cooperation.
Source: Resources Policy
Author: Qinxue Wang
Institution: National Institute for Environmental Studies
Language: English
Subfield: Mechanical Engineering
Field: Engineering
Domain: Physical Sciences
Open Access status: hybrid
Estimated APC paid: $3,810
OpenAlex ID: W7124738004