Japan New Investment in French REE Project

PARIS -- Japan will invest about 100 million euros ($109 million) in a French rare-earth refining project, looking to reduce its dependence on China for industrial metals that are crucial to electric vehicles and other technologies.

The refining and recycling project is planned by French company Carester. Tokyo will invest through the Japan Organization for Metals and Energy Security, the Ministry of Economy, Trade and Industry said Monday.

France will support the project with over 100 million euros in subsidies and tax breaks.

Japan signed a long-term supply contract covering dysprosium and terbium, rare-earth elements used in high-performance magnets for EVs. The contract is expected to supply Japan with about 20% of its future demand for these minerals.

Though rare earths are mined in North America, Asia, Australia and elsewhere, China has regulatory and cost advantages in refining, which is essential for turning the minerals into magnets and other products.

Carester is preparing to begin operations at a plant in southwestern France at the end of 2026. In addition to refining ore, the company has the technology to recover rare earths from EV magnets and other used parts.

Reusing rare earths is a critical part of the supply chain for Europe and Japan, which have few of their own rare-earth mines. A 2023 road map for bilateral cooperate between Japan and France calls for promoting critical minerals projects.

Carester has signed a supply contract with European automaker group Stellantis for rare earths produced at the new factory. The facility is expected to be able to produce 590 tonnes of dysprosium and terbium a year, some of which will be supplied to Japanese companies through gas trader Iwatani. "Source: Asia.nikkei"