China denies blocking metal exports to Japan

23 Sep 2010, 5:22 pm   -   Source: AAP, SBS Staff
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Many electric cars, such as the Prius, rely on the metals. (Getty)

Many electric cars, such as the Prius, rely on the metals. (Getty)

China has denied reports it has blocked all exports of technology-critical 'rare earth' metals to Japan, stepping up the pressure on Tokyo to release a Chinese boat captain.

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China has denied is has blocked all exports of rare earth metals to Japan, stepping up the pressure on Tokyo to release a Chinese boat captain detained in disputed waters, a report said on Thursday.

Reports said China has halted all shipments to Japan of the group of metals, essential for the making of iPods, electric cars such as the Toyota Prius, missiles, wind turbines and a range of other products, the New York Times reported, citing unnamed industry sources.

But China swiftly moved to damped down the claims.

Japan and China are embroiled in their worst diplomatic row in years, sparked by the captain's arrest following the September 7 collision of his trawler with two Japanese coastguard vessels in the East China Sea.

Although other sources are being investigated, China supplies at least 95 per cent of the world's rare earths, as this map shows. It had previously cut its export limit for the minerals, sending market prices soaring and sparking concerns among foreign governments and companies.

Chinese Premier Wen Jiabao this week threatened "further actions" if the captain was not released. Beijing has already suspended high-level contacts with Tokyo and called off several official visits.

The issue of cutting the export of the metals in question has long worried both Japan and Korea. China says it needs the metals for its industry - and as it has long invested in the harvesting of the metals, it should reap the rewards, or so the logic goes.

Last month, before the row erupted, Japan had urged China to expand, not restrict, its exports of rare earths.

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