Japan Bets on Deep-Sea Mining, Plans Rare Earth Facility by 2027 to Counter China

Japan is moving to unlock a vast deep-sea treasure trove of rare earths, planning to build a processing facility by 2027 in a direct challenge to China's stranglehold on the critical minerals market. The move aims to bolster Japan's economic security by tapping its own resources from the abyssal depths of the Pacific Ocean.

According to the plan, the facility will be constructed on Minamitorishima, Japan's easternmost island located about 1,950 kilometers (1,200 miles) southeast of Tokyo. It will process rare-earth-rich mud extracted from the ocean floor some 6,000 meters (nearly 20,000 feet) below the surface—a significant technological undertaking.

Why it matters: Rare earth elements are indispensable for everything from electric vehicle motors and smartphones to sophisticated defense systems. China currently dominates the global supply, giving it immense geopolitical leverage. By developing a domestic source, Japan seeks to de-risk its high-tech industries from potential supply disruptions, a lesson learned from past trade disputes where Beijing restricted mineral exports.

Don't expect rare earth prices to plummet overnight. Commercial-scale deep-sea mining is still unproven and years away. However, this is a major strategic signal. The project represents a government-backed push to create resilient, 'friend-shored' supply chains. For investors, this move could catalyze innovation in deep-sea robotics and extraction technologies. In the long term, it could lower the geopolitical risk premium for Japanese and allied tech manufacturers that depend heavily on these materials.