en.Wedoany.com Reported - Canada and Japan have launched a new round of cooperation in the field of critical minerals, announcing the signing of a CAD 1 billion commercial agreement and plans to assess strategic reserves of minerals such as graphite and gallium to reduce reliance on China's supply chain.
This collaboration took place during a trade mission in Tokyo, considered Canada's largest commercial event in the Asia-Pacific region, bringing together 300 participants and nearly 180 companies and organizations.
Canada's International Trade Minister Maninder Sidhu confirmed that the two countries are studying a joint reserve mechanism aimed at enhancing supply security in the event of disruptions or shortages. Currently, Japan relies on China for approximately 80% of its rare earth minerals. China accounts for about 60% of global rare earth mining and over 90% of refining, while also dominating the production of graphite, gallium, and battery-grade materials. These materials are widely used in rocket nozzles, missile nose cones, broadband semiconductors, electric vehicles, renewable energy, and defense systems.
Since 2023, China has imposed restrictions on the export of gallium and germanium, with measures further tightened in 2025. On April 4, 2025, China implemented export controls on seven heavy rare earth elements, their compounds, metals, and related magnets; on October 9 of the same year, the controls expanded to include five additional elements, products, equipment, technology, and experts. In February, Beijing banned the export of dual-use goods to 20 Japanese companies, further heightening Tokyo's urgency to seek alternative suppliers.
In mining and procurement, Canada and Japan are discussing joint mining projects and offtake agreements—a model where buyers commit in advance to purchasing a portion of future production—to provide market predictability for mineral projects. Mitsubishi, which has invested in LNG Canada, participated in the delegation and expressed interest in developing critical minerals in Canada. Canada also signed a cooperation agreement with Panasonic focused on battery-grade graphite.
This move aligns with broader coordination among industrialized economies. Leaders of the Group of Seven (G7) have pledged to address rare earth dependency, aiming to keep exposure to non-member countries below 60% by 2030.
Critical minerals and rare earths play a pivotal role in modern industry, spanning advanced electronics to defense and energy transition. When production, refining, or exports are concentrated in a few suppliers, any restrictions can impact prices, delivery times, and component availability. Through strategic reserves, long-term procurement contracts, and new mining projects, countries are seeking to create alternatives for supply chains in sensitive sectors such as batteries, semiconductors, electric vehicles, and military systems.
