Japanese government will issue huge subsidies for rare earths

Japan’s Ministry of Economy, Trade and Industry has stated that it will grant a total of 33.1 billion yen (about 2.66 billion yuan) in subsidies to Japanese private companies to encourage companies to reduce the use of Chinese rare earths.

This subsidy policy will target 160 projects for 110 companies, including recycling of rare earths, reduction of rare earth use, and expansion of import channels. Japan’s Ministry of Economy and Trade said that it hopes that this subsidy policy will reduce the demand for rare earths in Japan from the current 30,000 tons per year to 20,000 tons in the future.

A large portion of the subsidy will be used for equipment investment and project development. For example, Toshiba Corporation introduces new grinding equipment that does not require the use of niobium (a type of rare earth), Toyota, Nissan develops auto parts test equipment for rare earth-free materials, Japan Heavy Chemical Industry Added rare earth raw materials forging alloy projects. In addition, subsidies will also be used to import rare earths from the United States, Australia and Vietnam.

In addition to the 160 projects decided on in the first batch, the Ministry of Foreign Affairs of Japan plans to invest an additional 9 billion yen. If you add the company's own investment, the total project size is expected to be as high as 110 billion yen.

The report said that the Japanese government's move was to reduce the risk of over-reliance on China's rare earth.

As the world’s largest producer and exporter of rare earths, China is gradually reversing its previous extensive mining situation. On February 16, Premier Wen Jiabao chaired the meeting to study the rare earth policy and stated that he should reasonably determine the annual export quota for rare earths.