Japan, EU to explore joint rare earths procurement, Nikkei reports

Japan and the European Union will consider joint public-private partnerships as they look to reduce their reliance on China in areas such as the procurement of rare earths, the Nikkei newspaper reported on Thursday.

As China, the dominant supplier of rare earths, tightens export controls, global manufacturers are concerned that Beijing’s decision to curb exports of rare earth alloys, mixtures and magnets could slow production and disrupt supply chains.

Globally, countries have been trying to secure rare earth supply chains to loosen China’s grip on the materials used to build weapons, electric vehicles and many electronics.

Japan and the EU will launch a new “economic two-plus-two” dialogue to bring together their foreign and economy ministers, expected to be announced at the Japan-EU leaders’ summit scheduled for July 23, according to the report.

The talks aim to identify specific areas of cooperation between the parties from this summer onwards, it said.

The countries will jointly develop supply chains for critical minerals such as rare earths, after the two sides agreed to a new dialogue at the working level.

They will focus on simplifying EU regulations and discuss how Japanese companies can take part in EU projects under the new framework, which seeks to deepen Japan-EU ties, Nikkei said.

The framework will also add Stephane Sejourne, the European Commission’s executive vice president for prosperity and industrial strategy, to the talks.

Earlier this month, the US Department of Defense signed a multibillion-dollar deal with MP Materials that will make the Pentagon its largest shareholder, to boost rare earths output.

India is holding talks with Chile and Peru to source critical minerals under ongoing free trade pact negotiations, Reuters reported earlier this week, citing a trade ministry source.

(By John Biju; Editing by Pooja Desai)