New York: China has banned exports of rare earth to Japan, following the arrest of a Chinese trawler captain, which has led to diplomatic tension between the two countries.
The New York Times reported on Thursday that an initial trade embargo on all exports of rare earth minerals is likely to last until the end of the month.
Rare earth traders in China said they had not been informed of the ban but one Japanese trade official said he’d heard rumours of an embargo.
China is the number one exporter of rare earth, accounting for 97 per cent of the world supply in 2009. A 72 per cent cut in its export quotas for the second half of 2010 has sent global prices soaring.
It has 17 types of rare earth, including yttrium and lanthanum, which is used in small quantities to enhance batteries, computer and weapons systems, as well as other applications.
This week, Chinese Premier Wen Jiabao threatened retaliation against Japan unless it released the trawler captain, who is accused of having rammed into two Japanese coastguard ships.
Beijing has already suspended high-level contact with Japan over the issue and postponed talks on increasing flights between the two countries.
Japanese prosecutors have until September 29 to decide whether to bring charges against the captain.
