By Rina Ukita and Taku Mukoyama

Yomiuri Shimbun Staff Writers

The Japanese government, in cooperation with Japanese and U.S. companies, will set up a facility in Australia for producing gallium, as it looks to reduce dependence on China and establish its own system for producing the rare metal, it has been learned.

Gallium is an important mineral essential for making semiconductors. It is used in a wide range of products, including power semiconductors for electric vehicles, LEDs and radar systems.

However, China controls 96% of the metal's global production, excluding recycling, and it has tightened its export controls, making it difficult for Japan to ensure a stable supply. The government hopes its plan will strengthen Japan's economic security.

The Japan Organization for Metals and Energy Security (JOGMEC), which is under the jurisdiction of the Economy, Trade and Industry Ministry, will establish a joint venture in Australia with major trading company Sojitz Corp. and U.S. aluminum giant Alcoa Corp., with production set to begin in 2026. Alcoa already owns an aluminum smelter in Australia.

Gallium can be extracted during the aluminum smelting process. Once the joint venture establishes a production facility, it will seek to reach an annual output of more than 55 tons of the metal in 2028, equal to the amount Japan imports from China.

In 2021, Japan used 167 tons of gallium, of which 97 tons were imported. The country has been working to diversify its procurement sources, but 55 tons, or about 60% of imports, still come from China.

Since China tightened its export controls on gallium in August 2023, exports to Japan have fallen by 80% to 90%, to around 10 tons. Parts manufacturers that use gallium are managing to keep production going by recycling the metal and using existing inventory.

China has said that its export controls are not targeted at specific countries or regions, but they are viewed as retaliation against Japan, the United States and Europe, which have restricted exports to China in the advanced semiconductor sector.

Uncertainty about the future is also growing due to U.S.-China trade friction.

In April, China took measures to restrict exports of rare earths as part of its response to reciprocal tariffs imposed by U.S. President Donald Trump's administration.

The governments of the United States and China agreed at a ministerial-level meeting in late July to seek an extension of their pause in tariffs and related measures, but the dispute seems liable to escalate at any time.

China controls a large part of the market for important minerals, as well as the smelting and refining processes, posing economic security risks for Japan.

Given the circumstances, the government plans to hasten the building of a procurement network that is not reliant on certain countries and to support related industries.

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This article is from The Yomiuri Shimbun. Neither Dow Jones Newswires, MarketWatch, Barron's nor The Wall Street Journal were involved in the creation of this content.

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August 04, 2025 00:57 ET (04:57 GMT)

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