Sumitomo Electric Industries is investing 15.9 billion yen ($100 million) in a new tungsten production plant in Toyama, Japan. The goal: cut China out of one of the most critical materials in semiconductor and tool manufacturing.
The dependency
Today, roughly 30% of the tungsten powder that Sumitomo processes comes from China. Tungsten is not optional. It goes into cemented carbide cutting tools, semiconductor devices, and electronic components. Without it, factories stop.
China controls the global tungsten market and has already added the material to its dual-use export control list, alongside molybdenum, specialty alloys, and carbon fiber. For Japan's manufacturers, the message from Beijing is clear: supply can be weaponized at any time.
What Sumitomo is building
The new facility will sit next to the existing Toyama Works plant operated by ALMT, Sumitomo's tungsten subsidiary. Once operational, it will boost the company's tungsten supply capacity by 50%. Japan's Ministry of Economy, Trade and Industry (METI) is covering nearly half the cost with a 7.5 billion yen subsidy.
Sumitomo is also expanding domestic recycling, reclaiming tungsten from used cutting tools and industrial waste. The strategy is two-pronged: produce more locally and recover what already exists in the system.
The bigger picture
This is not an isolated move. Japan has been systematically reducing its exposure to Chinese critical materials since Beijing tightened export controls in 2024. Rare earths, gallium, germanium, and now tungsten. Each restriction accelerates a Japanese investment in domestic alternatives.
The catch: none of these substitution programs are cheap or fast. Sumitomo's plant will take years to reach full capacity. In the meantime, 30% of its tungsten still comes from the country it is trying to decouple from.
Sources: Nikkei Asia, TradingView/Reuters
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