
The Platreef platinum min in Limpopo Province in northern South Africa. Japanese company Itochu Corp is one of the investors in the project.
10:43 JST, April 16, 2021

A Japanese flag was flying in a mountainous area about four hours by car from Johannesburg, the largest city in South Africa. This is the platinum mine called Platreef, which has been developed under the leadership of a Canadian resources giant and is expected to have the world’s largest platinum reserves. The Japanese flag represents the fact that Itochu Corp., which joined the project 11 years ago when the mine was discovered, has an interest in it.
China is increasing its presence in the endeavor, as the Canadian company signed a strategic partnership with the Chinese state-owned enterprise China Nonferrous Metal Mining (Group) Co. in August last year.
When it comes to platinum, many people might think of jewelry items, but its value is increasing, as the rare metal (see below) serves as an essential catalyst for fuel cell vehicles and catalytic converters (exhaust emission control devices). Supply shortage concerns have been pushing up international prices for platinum.
Three-quarters of the world’s platinum reserves are in South Africa. China depends on imports for over 90% of its platinum supply, and the country has apparently started taking steps to secure its interests.
Rare metals, which include rare earths, are also essential to produce electrified vehicles, semiconductors and high-performance electronic components.
China is skilled at refining ore into products. Of the 17 rare earths, about 60% of the world’s production comes from China. Following the collision between a Japan Coast Guard patrol vessel and a Chinese fishing boat off the Senkaku Islands in Okinawa Prefecture in 2010, China restricted the exports of some rare earths to Japan, which hindered Japanese companies’ activities.
Japan filed a case with the World Trade Organization against China, in cooperation with the United States and the European Union. The WTO recognized China’s violation of WTO rules and ruled against Beijing.
Chinese President Xi Jinping said that rare earths were important strategic resources when he visited a rare earth production area in Jiangxi Province in 2019. Japan, the United States and Europe are increasingly concerned that China could again use rare earths as a diplomatic tool.
Public-private cooperation
Rare metals are found only in specific locations, and they give a great advantage to the countries that have them.
Nickel is used for EV batteries. Indonesia boasts the world’s largest production volume of that rare metal, accounting for more than 30% of global production. Indonesian President Joko Widodo signed an executive order in 2019 to develop an international EV battery production hub. The president also strengthened export restrictions on nickel and encouraged foreign businesses to enter the country.
As if in line with Indonesia’s “local production for local consumption” strategy, the Chinese stainless steel maker Tsingshan Holding Group began constructing a battery parts plant in 2019 on Sulawesi island, a nickel production area in central Indonesia. In 2020, South Korea’s Hyundai Motor Group announced it would start to produce EVs on the outskirts of Jakarta.
Indonesia is rumored to have promised special treatment for China and South Korea, such as tax breaks. Major Japanese companies, which have a more than a 90% share in Indonesia’s automobile market, are increasingly cautious, calling through the Japanese Embassy for Indonesia to develop an environment for fair competition.
The Japanese public and private sectors are working together to secure resources. The government plans to add rare metals to the key international resource procurement list in the Strategic Energy Plan that will be revised this summer. Japan previously placed the highest priority on securing fossil fuels such as petroleum and natural gas, but it will change this policy to pave the way for achieving net-zero greenhouse gas emissions by 2050.
The government also plans to develop a center in Japan to reclaim rare metals that can be used for storage batteries and other goods from within and outside Japan, and reuse them. Japan relies on imports for almost all rare metals, and about 60% of the supply of rare earths comes from China. Japan will establish a recycling system as a third pillar along with securing interests in overseas mines and storing rare metals domestically.
The United States is also making moves toward ensuring a stable supply of rare metals. In February, U.S. President Joe Biden signed an executive order to strengthen U.S. supply chains for four key products — rare earths, semiconductors, EV batteries and medicine — asking relevant ministries and agencies to review risks and problems in supply chains within 100 days of the order’s date.
The United States also will seek cooperation in securing rare metal supplies among Japan, the United States, Australia and India, which are working together to realize a “free and open Indo-Pacific” framework, with an eye on China.
Rare metal
A collective term for about 30 metals that exist only in small amounts on Earth, or are only available in small quantities due to the difficulty of extraction. In addition to things like lithium and cobalt, rare metals also include rare earths. Rare metals are used for a wide range of purposes, such as producing components for luminescent diodes, batteries and permanent magnets. They are also essential to new decarbonization technologies.
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