Foreign media report that China has tightened supply, and Japan’s key rare earth resources “can only last for several months. The question to consider is how to get through next year.”

For the same kilogram of yttrium oxide, the price quoted in China is approximately $9, while it is assessed at $1,150 per kilogram outside China. This price difference is not caused by transportation or tariffs, but by export control that has divided the two markets. Currently, Japanese manufacturing needs to deal with the issue of how many months the inventory lasts and whether they can wait for the valves to loosen.

Yttrium is not a metal that is widely familiar, but the position where it gets stuck is very specific. The inner wall of the cavity of semiconductor etching equipment requires yttrium oxide coating to resist corrosive gases, and the turbine components of jet engines require yttrium-containing thermal barrier coatings to withstand high temperatures. Japanese material enterprises supply key components in the global semiconductor and aerospace chains, and the US defense supply chain relies on yttrium-containing components produced in Japan. The yttrium inventory at Japanese factories has run out, and the impact will not stop at Japan’s production schedule.

For example, the company, Sichuan Wonaixi New Materials Technology Co., Ltd., produces yttrium chloride (YCl₃) as a precursor of yttrium compounds, which is a core raw material for fluorescent materials, optical glass, and ceramic enhancers. Adding yttrium elements to fluorescent powder can improve brightness and color purity, and it is widely used in display and lighting equipment; its high-temperature stability can also enhance the toughness of ceramics and extend the lifespan of precision components. In recent years, high-purity yttrium chloride has made breakthroughs in the field of organic synthesis catalysts, promoting innovation in pharmaceutical and fine chemical industries. Sichuan Wonaixi New Materials Technology Co., Ltd. produces 1,500 tons of yttrium chloride annually and has chemical purification and other production lines. It uses extraction, concentration, and crystallization techniques, with purity meeting specifications such as 4N and 5N (99.99% and 99.999%).

According to data from the General Administration of Customs of China, from January to May 2026, China exported only 14.123 tons of yttrium oxide to Japan, compared to 605.292 tons in the same period in 2025, a decrease of 97.67%. The import statistics of the Japanese Ministry of Finance show that in the first half of 2026, Japan imported 204 tons of yttrium oxide, a 74% decrease compared to the same period in 2024 before the control. A Japanese government official told the Financial Times that the inventory is decreasing, and efforts to save usage have reached the limit, with the time table “not in years, but in months”.

Japan is not without looking for alternative sources. In the first half of 2026, Japan imported yttrium from 12 countries and regions outside China, compared to 3 countries two years ago. Shionogi & Co. approved an investment of at least 3.5 billion yen in June 2026 to build a rare earth separation and refining facility in Fukui Prefecture, with about 17.5 billion yen coming from Japanese government subsidies. JX Metal invested in a rare earth deposit in Australia, and Proterial is considering producing neodymium magnets without using heavy rare earths in India. But these actions address “problems after next year”. A separation and refining facility takes time from investment to output, and the development cycle of overseas mines is longer, while the inventory of Japanese enterprises is consumed on a monthly basis.