China has added 10 US firms to its export...

Editor's note: ...control list, including two key rare earth companies, MP Materials and USA Rare Earth, while restricting 46 American companies from government procurement. This move, announced by China's Ministry of Commerce, directly responds to the Pentagon's recent expansion of its list of Chinese military-linked entities. It prohibits the export of dual-use items to these firms and blocks any transfer of Chinese-origin dual-use goods to them, with immediate effect on ongoing shipments. The targeted US defense contractors include drone makers, aerospace firms, and major players like Oshkosh Defense and L3Harris. This action underscores Beijing's strategy to weaponize its dominance in rare earth supply chains amid ongoing US-China tensions. No direct tungsten restrictions are mentioned in this specific announcement, though China maintains separate export controls and licensing requirements on tungsten that have already severely impacted allied supply chains, particularly to Japan.
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China's Tungsten Dominance and Export Controls: A Strategic Chokepoint Reshaping Japan's Industrial Future

June 24, 2026 | AD News Network

China controls approximately 80% of global tungsten mine production and an even larger share of processing capacity, making the metal a potent geopolitical lever. Tungsten's extreme hardness, high melting point, and density make it indispensable for defense (armor-piercing munitions, missile components, radiation shielding), semiconductors, cutting tools, aerospace alloys, and advanced manufacturing. In early 2025, as tensions escalated with the US and Japan, Beijing imposed tightened export controls and licensing requirements on tungsten and related rare metals (including tungsten carbide, powder, and dual-use items).

By January 2026, China escalated with specific dual-use export bans targeting items destined for Japan's military or defense-related sectors, citing concerns over Japan's statements on Taiwan. Chinese customs data shows tungsten exports to Japan plummeting, halving in April 2026 compared to 2025 averages, and reaching zero for key forms like tungsten carbide and powder from February through April 2026. This de facto embargo has triggered sharp price surges (reportedly tripling or more in some segments) and immediate supply chain disruptions.

Japan's Economic Exposure and Response

Japan, lacking significant domestic tungsten resources, has long depended heavily on Chinese imports for its world-leading automotive, electronics, machinery, and precision manufacturing sectors. The restrictions hit cutting-tool makers, semiconductor suppliers, and defense contractors hard. Companies like Sumitomo Electric and Mitsubishi Materials have reported halted shipments and are scrambling for alternatives.

In response, Japan is accelerating tungsten recycling and diversification. US exports of tungsten scrap to Japan surged dramatically, reaching 590,000 kg in Q1 2026, 24 times the full-year 2025 figure, while imports from Europe and Singapore also rose. Major firms are investing in expanded domestic and overseas recycling capacity to recover tungsten from used carbide tools and industrial waste, aiming to build a more circular supply chain. This shift raises costs (recycled material is often more expensive short-term and requires technological upgrades) and may not fully offset volume shortfalls immediately.

Severe Impact on the US Defense Industry

The restrictions compromise the US defense industrial base far beyond Japan's borders. The US has no active domestic tungsten mines and relies heavily on imports and allied processing, particularly from Japan and other partners that traditionally source from China. Tungsten is critical for American munitions, penetrators, turbine engines, and armored systems, with surging demand from ongoing global conflicts draining stockpiles. Pentagon contractors now face acute shortages and skyrocketing costs as Chinese controls tighten.

This vulnerability is magnified because Japan serves as a key supplier and processor in integrated US-Japan defense supply chains. Disruptions in Japanese production of tungsten-based components directly delay American weapons programs, increase manufacturing expenses, and threaten readiness. US Department of Defense sourcing rules set to take effect in 2027 aim to restrict Chinese-origin tungsten in military equipment, but the transition exposes a dangerous gap. Defense analysts warn that prolonged shortages could cripple production of missiles, fighter jet parts, and other essential systems at a time of heightened strategic competition.

Broader Economic Impacts on Japan

Higher tungsten prices and supply uncertainty are feeding into increased production costs across industries, potentially eroding competitiveness in global markets for tools, auto parts, and electronics. Defense production faces delays or higher expenses, complicating Japan's military buildup amid regional tensions. Semiconductor and AI-related supply chains are also vulnerable, with risks of production halts for specialty gases and components. Long-term, this accelerates Japan's push toward supply-chain resilience, stockpiling, alliances with the US and allies, and domestic innovation, but at the price of short-to-medium-term inflation in manufacturing inputs and possible GDP drag in export-heavy sectors.

This episode echoes China's 2010 rare-earth restrictions on Japan but occurs in a more contested geopolitical environment. It underscores the risks of concentrated critical-minerals dependency and is driving a broader Western-aligned effort to develop alternative sources, though China's processing dominance remains a formidable barrier. For Japan, the tungsten crunch is not just a materials issue, it is a test of economic adaptability in an era of "weaponized supply chains."

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More on tungsten:

China's Tungsten Exports to Japan Hit Zero for Three Straight Months; Prices Surge Over 3-Fold Amid Procurement Crisis, Sending Shockwaves Through Manufacturing

China's rare-earth exports to Japan drop 80%, sending companies scrambling

Without tungsten gearing up US auto manufacturers to produce weapon systems might be a difficult under taking:

Trump says Ford, GM in talks with defense contractors about possible weapons production

Any discussions taking place over tungsten supplies?

🇺🇸 President Trump has summoned senior Pentagon officials and executives from major U.S. defense contractors to the White House on Wednesday to discuss increasing munitions production amid concerns over missile stockpiles, per WSJ

The meeting is expected to be tense.

The…

— Megatron (@Megatron_ron) June 22, 2026

Just great, Japan's much vaunted Toyota and Nissan cars manufactured in the US are substandard. Holding out on those ignorant Americans, hey Japan?

Toyota And Nissan Admit Their American-Made Vehicles Aren't Up To Japanese Standards