Canada and Japan Exploring Critical Minerals Stockpile
Canada and Japan are discussing the possibility of joint stockpiling of critical minerals, as well as other measures, in a move to loosen their dependence on China supply chains.
Among the metals being discussed are graphite and gallium, both of which are used extensively by the defence industry. Heat-resistant graphite is critical to the manufacturing of rocket nozzles and missile nose cones, while gallium is used to make “wide bandgap" semiconductors.
Canada’s International Trade Minister Maninder Sidhu confirmed the talks during a trade mission to Tokyo, where Canadian and Japanese companies signed more than CA$1bn (US$705m) in commercial deals.
Sidhu led a delegation of roughly 300 members from nearly 180 companies and organisations, making it Canada's biggest mission to the Asia-Pacific region to date.
The two governments are considering a range of cooperation measures, including joint mining projects, off-take agreements, in which buyers guarantee purchases of a producer's future output, and shared stockpiling arrangements.
Shared physical reserves would mean both countries have a buffer against potential supply disruptions, with drawdown available during shortages if needed.
China targeting Japan with export restrictions
China imposed export controls on gallium and germanium in 2023, then tightened restrictions even further in early 2025 by extending the controls to molybdenum.
In February 2026, Beijing prohibited exports of dual-use items to 20 Japanese companies, pointing to their alleged role in supplying Japan's military.
The move followed remarks by Japanese Prime Minister Sanae Takaichi, who said Tokyo would act in the event of an attack on Taiwan, which China claims as its own.
According to price reporting agency Benchmark Mineral Intelligence, China supplies 80% of Japan's rare earth imports as of early 2026. Globally, China accounts for around 78% of graphite mining production, and processes over 90% of the world's supply into battery-grade material, according to the US Geological Survey and GlobalData respectively.
China also accounted for 99% of worldwide primary gallium production in 2024, according to the US Geological Survey.
The G7 response
G7 leaders agreed a strategic alliance on critical minerals at a summit in Evian, France, the week before Sidhu's Tokyo visit. In the agreement, members committed to reduce dependence on any single non-G7 supplier of rare earths and permanent magnets to below 60% by 2030.
While the declaration did not name China directly, it referenced concerns about "the use of non-market policies and practices and economic coercion, including arbitrary export restrictions" on critical minerals.
Mitsubishi, which is already a major investor in LNG Canada, the first liquefied natural gas export facility in North America with direct Pacific Coast access, expressed interest in investing in Canada's critical minerals industry during Sidhu's Tokyo visit.
Canada pointed to an existing off-take agreement between Nouveau Monde Graphite and Panasonic, under which the Japanese electronics giant will source battery-grade graphite from Canada, as a model for future deals between the two countries.
