INSTITUTION PROFILE / FUNCTIONAL MATERIALS
Ministry of Economy, Trade and Industry (METI)
– The Japanese policy ministry that certifies and subsidizes plans to secure critical minerals and permanent magnets
METI is a Japanese government ministry. It does not make materials or carry out research itself. What stands out in its role in functional materials is that, under the Economic Security Promotion Act, it sets policies for the stable supply of critical minerals (rare earths and others) and permanent magnets, then certifies companies’ supply assurance plans and subsidizes them. This differs from NEDO, which allocates research and development funds: METI is the side that decides which items to protect and against what targets. This profile focuses on how far METI’s influence over functional materials actually reaches.
- METI in 30 seconds
- What kind of institution – the “type” of influence
- What METI does in functional materials
- Reach of influence (authority and geography)
- Companies and organizations involved
- Outlook
- Glossary / References / Claim-to-source audit
1. METI in 30 seconds
What METI decides is what to protect, against what target, and whose plan to certify and subsidize. For critical minerals and permanent magnets, METI has published policies based on Article 8 of the Economic Security Promotion Act (Act No. 43 of 2022) and certifies companies’ supply assurance plans that follow them Sourced. The policies state that the subsidy work is handled by JOGMEC (Japan Organization for Metals and Energy Security) for critical minerals and by NEDO for permanent magnets Sourced. In short, METI sets direction and targets, and other bodies are the windows that carry them out.
2. What kind of institution – the “type” of influence
The institutions that appear in functional-materials stories are unlike companies: they do not make materials themselves. They can be sorted into four types by the channel through which they influence the industry.
3. What METI does in functional materials
METI’s involvement in functional materials falls into three strands Sourced. The work is handled by the Minerals Division, the Metals Division and the Materials Industries Division of the Manufacturing Industries Bureau (our translations of the Japanese division names).
| Strand | Scale and timing | What it does | Main actors |
|---|---|---|---|
| Stable supply of critical minerals | Policy set on 19 January 2023; revised in March 2024, June 2025 and 30 March 2026. 12 supply assurance plans certified (as of 16 September 2026) | Covers 36 items (our count; including lithium, nickel, cobalt, graphite, rare earths, gallium, tungsten and fluorine). Subsidies target exploration and feasibility studies, mine development, smelting and technology development. The 2030 targets include about 100,000 tonnes a year of lithium and other battery materials, and, for rare earths, about 13,000 tonnes a year of light rare earths (Nd, Pr) and about 1,200 tonnes a year of heavy rare earths (Dy, Tb), set as the quantities needed for domestic demand | METI (policy and certification); JOGMEC (managing the fund, reviewing plans, paying subsidies); certified companies |
| Stable supply of permanent magnets | Policy published in January 2023; March 2026 edition. 6 plans certified (August 2023 to February 2026) | Targets securing production capacity for 2030 domestic demand and doubling recycling capacity from the 2020 level. METI states that Japanese companies held about 15% of world neodymium magnet production in 2021 | METI (policy and certification); NEDO (managing the fund, paying subsidies); certified magnet makers and others |
| Growth strategy for the materials industry (draft roadmap) | A draft dated 21 April 2026 (Manufacturing Industries Bureau) | States that the materials industry accounts for about 20% of Japan’s manufacturing shipments. Names five areas where Japan is strong (high-performance fibers, polymers, films, high-purity fine particles and high-performance ceramics), and calls for an environment in which AI-driven materials development speeds up new-material development tenfold. Also sets a 2030 target of supplying about 30% of permanent-magnet raw materials through recycling | METI, industry, academia and government |
Examples of certified supply assurance plans (companies relevant to our company profiles)
| Company | Item and content (as in METI’s list of certified plans) | Date certified and subsidy |
|---|---|---|
| Shin-Etsu Chemical (with local subsidiaries) | Permanent magnets. Certified jointly with Shin-Etsu Magnetics subsidiaries in Thailand, the Philippines and Vietnam | 9 April 2024 |
| Shin-Etsu Chemical (with a local subsidiary) | Permanent magnets. Certified jointly with a subsidiary in Vietnam | 30 April 2025 |
| Shin-Etsu Chemical | Critical minerals. Build new smelting facilities in Japan to increase rare earth production | 19 May 2026; subsidy of about ¥17.5 billion |
| Kyocera | Critical minerals. Build new smelting facilities in Japan to recycle tungsten carbide for cemented carbide | 16 September 2026; subsidy of about ¥3.0 billion |
* The subsidy amounts for the permanent-magnet certifications do not appear on the list page we checked. The lists include many other companies as well (Aichi Steel, Daido Steel, Santoku, Honda, Mitsubishi Materials, Sumitomo Metal Mining and others), but this article names only those whose link to a company profiled in this series could be confirmed Sourced.
Reading the lists of certified plans, the subjects are new smelting facilities, mine exploration and recycling demonstrations, that is, “securing supply”. They do not certify material performance or standards. For a materials supplier, the policies are a document showing which items’ demand the state wants to back. The permanent-magnet policy, for example, notes that some applications need added dysprosium or terbium for heat resistance, and that samarium-cobalt and ferrite magnets serve uses where substitution is hard, so it is clear that rare-earth-reduced or rare-earth-free magnets and recycling of scrap magnets are within the scope of policy (References 4 and 5).
4. Reach of influence (authority and geography)
| Aspect | What METI has | What METI does not have |
|---|---|---|
| Authority | The authority under the Economic Security Promotion Act to set policies and to certify companies’ supply assurance plans. The policies define the conditions for designation under Article 44, where the state itself responds through stockpiling and similar measures. METI also confirms the business plans of JOGMEC and NEDO for their subsidy work | The day-to-day allocation of research funds (NEDO) and the execution of resource exploration and investment (JOGMEC). Decisions on laws and budgets (the Diet). A role in setting materials standards or certification (we could not confirm one) |
| Geography | Japan’s policy. Certified plans have, however, included Japanese companies’ overseas subsidiaries (Thailand, the Philippines, Vietnam) and an exploration project at an Australian mine | Direct authority over other countries’ companies or policies. We have not checked whether a foreign company could receive a subsidy on its own |
| Spillover | The targeted items and goals are likely to inform capital-investment decisions by Japanese materials and component makers (inference) | Authority over international resource prices or other countries’ export controls |
| Scale | Authorized headcount of 8,068. FY2026 initial budget: stable supply support (critical minerals) ¥12.5 billion, and a new critical-mineral supply chain resilience project of ¥5.0 billion. FY2025 supplementary budget: mineral supply chain diversification and stabilization ¥93.7 billion, and economic-security supply chain resilience ¥46.6 billion (of which permanent magnets ¥17.0 billion) | A total budget for functional materials alone is not broken out in the published documents, so we have not calculated one |
The 8,068 is an authorized headcount, not the number of people actually in post. The ¥375.4 billion covers the general account only; the METI-related total of ¥3.0693 trillion also includes the energy special account (¥2.5333 trillion, of which ¥1.239 trillion is for AI and semiconductors) and others Sourced. All of these are totals across all fields, not figures for functional materials. The subsidies of the 12 certified critical-mineral plans range from about ¥1.2 billion to about ¥17.6 billion, and add up to about ¥96.4 billion, but this is a simple sum of amounts stated at the time of certification and not money actually paid Our calculation. We have not confirmed actual disbursements Not yet confirmed.
5. Companies and organizations involved
| Organization | Relationship with METI (as stated in official documents) | This series |
|---|---|---|
| JOGMEC (Japan Organization for Metals and Energy Security) | Manages the subsidy fund for critical minerals and reviews plans. In 2022 its remit was extended to equity investment and debt guarantees for smelting in Japan (critical-minerals policy) | – |
| NEDO (New Energy and Industrial Technology Development Organization) | Selected as the body carrying out the stable-supply support work for permanent magnets (permanent-magnet policy). NEDO’s role as a research-funding agency is separate | – |
| Shin-Etsu Chemical | Two permanent-magnet plans and one critical-mineral (rare earth) plan certified | Company profile (in preparation) |
| Kyocera | One critical-mineral plan (tungsten carbide recycling) certified | Company profile (in preparation) |
6. Outlook
| What can be read | Primary-source basis | Status |
|---|---|---|
| Certifications of critical-mineral plans have been increasing in 2026, and the trend may continue for the time being | Counting the dates on the certification list: 1 in 2023, 4 in 2024, 1 in 2025 and 6 so far in 2026 (to September). The permanent-magnet policy states that China’s export controls on rare earths and magnets in April 2025 delayed magnet production and supply | Inference |
| The policies will keep being revised, and changes in covered items or targets will move what is subsidized | The critical-minerals policy, set in January 2023, has been revised three times (2024, 2025 and 2026). The text says all items are reviewed continuously | Inference |
| The materials roadmap is still a draft, and its final content is not settled | The 21 April 2026 document is titled “Roadmap (draft)”. We have not confirmed a final version | Not yet confirmed |
| How the mineral-related items in the FY2025 supplementary budget (¥93.7 billion and others) translate into certifications and disbursements is unconfirmed | The supplementary amounts appear in the FY2026 initial-budget summary. We could not confirm disbursement results from METI’s documents | Not yet confirmed |
7. Glossary
- Economic Security Promotion Act
- Act No. 43 of 2022, which provides for measures such as securing the supply of important goods.
- Policy for ensuring stable supply
- A policy that the Minister of Economy, Trade and Industry sets for each item under Article 8 of the Act.
- Supply assurance plan (certification)
- A company’s plan for the stable supply of an item. If it meets the criteria, the Minister certifies it and it becomes eligible for subsidy.
- JOGMEC
- Japan Organization for Metals and Energy Security, which handles mineral exploration and investment and is the subsidy window for critical minerals.
- NEDO
- The New Energy and Industrial Technology Development Organization, which funds research and development and is also the subsidy window for permanent magnets.
- Critical minerals
- Metal minerals defined in the policy, such as rare earths, lithium, gallium and tungsten: 36 items by our count.
8. References
- Ministry of Economy, Trade and Industry (METI) Critical minerals, in Japanese (policy; list of 12 certified supply assurance plans; contact is the Minerals Division of the Manufacturing Industries Bureau). https://www.meti.go.jp/policy/economy/economic_security/metal/index.html
- METI Policy for ensuring the stable supply of critical minerals, in Japanese (revision of 30 March 2026; covered minerals, 2030 targets, measures, JOGMEC’s role). https://www.meti.go.jp/policy/economy/economic_security/metal/critical_minerals_torikumihoshin.pdf
- METI Permanent magnets, in Japanese (policy; list of 6 certified plans; contact is the Metals Division). https://www.meti.go.jp/policy/economy/economic_security/magnet/index.html
- METI Policy for ensuring the stable supply of permanent magnets, in Japanese (March 2026 edition; 2030 targets; Japan’s share of neodymium magnets; NEDO’s role). https://www.meti.go.jp/policy/economy/economic_security/magnet/magnet_hoshin_260331.pdf
- METI, Manufacturing Industries Bureau Growth strategy “Materials (critical minerals, parts and materials)” roadmap (draft), in Japanese (21 April 2026; Industrial Structure Council material). https://www.meti.go.jp/shingikai/sankoshin/seizo_sangyo/pdf/020_02_00.pdf
- METI Summary of the FY2026 initial budget, in Japanese (7 April 2026; general account ¥375.4 billion; METI-related total ¥3.0693 trillion; mineral-related projects and supplementary budget). https://www.meti.go.jp/main/yosan/yosan_fy2026/pdf/01.pdf
- METI Main organizational and staffing changes for FY2026, in Japanese (authorized headcount of 8,068 at the end of FY2026). https://www.meti.go.jp/main/yosan/yosan_fy2026/pdf/05.pdf
- METI Duties of each department: Manufacturing Industries Bureau, in Japanese (Minerals, Metals and Materials Industries Divisions). https://www.meti.go.jp/intro/data/pdf/07_seizo_sangyo.pdf
- METI METI’s mission, vision and values, in Japanese (history: MITI in 1949; renamed METI in 2001). https://www.meti.go.jp/intro/mvv/index.html
- JOGMEC Official English site (English name of the organization). https://www.jogmec.go.jp/english/
9. Claim-to-source audit
| Claim in the text | Status | Source |
|---|---|---|
| 12 certified critical-mineral plans (dates, subsidies, content); the Minerals Division as the contact | Sourced | Reference 1 https://www.meti.go.jp/policy/economy/economic_security/metal/index.html |
| Dates of the critical-minerals policy and revisions, covered minerals, 2030 targets, measures, JOGMEC’s role, Articles 8 and 44 | Sourced | Reference 2 https://www.meti.go.jp/policy/economy/economic_security/metal/critical_minerals_torikumihoshin.pdf |
| Six certified permanent-magnet plans; the Metals Division as the contact | Sourced | Reference 3 https://www.meti.go.jp/policy/economy/economic_security/magnet/index.html |
| Permanent-magnet targets, about 15% share of neodymium magnets, April 2025 export controls, NEDO’s role | Sourced | Reference 4 https://www.meti.go.jp/policy/economy/economic_security/magnet/magnet_hoshin_260331.pdf |
| Position of the materials industry, five areas, tenfold speed-up of new-material development, 30% magnet-material recycling (draft) | Sourced | Reference 5 https://www.meti.go.jp/shingikai/sankoshin/seizo_sangyo/pdf/020_02_00.pdf |
| General account of ¥375.4 billion; METI-related total of ¥3.0693 trillion; amounts of mineral-related projects and supplementary budget | Sourced | Reference 6 https://www.meti.go.jp/main/yosan/yosan_fy2026/pdf/01.pdf |
| Authorized headcount of 8,068 (end of FY2026) and 8,013 (end of FY2025) | Sourced | Reference 7 https://www.meti.go.jp/main/yosan/yosan_fy2026/pdf/05.pdf |
| Duties of the Minerals, Metals and Materials Industries Divisions | Sourced | Reference 8 https://www.meti.go.jp/intro/data/pdf/07_seizo_sangyo.pdf |
| MITI in 1949 and the renaming to METI in 2001 | Sourced | Reference 9 https://www.meti.go.jp/intro/mvv/index.html |
| English name of JOGMEC | Sourced | Reference 10 https://www.jogmec.go.jp/english/ |
| 36 covered critical minerals, the total of about ¥96.4 billion for the 12 certified plans, and the yearly counts of certifications | Our calculation | Our count and sum from References 1 and 2 |
| The four-type classification and the arrangement of Fig. 2 | Our calculation | Our own classification |
| Actual amounts disbursed for certified plans, subsidies for permanent-magnet certifications, total spending on functional materials alone | Not yet confirmed | Not in References 1 to 7. We do not estimate them (our own decision) |
| Conditions for foreign companies to receive subsidies, whether METI has a role in setting materials standards or certification, the final content of the roadmap | Not yet confirmed | Not in References 1 to 9. We do not assert that there is none; we could not confirm one (this article) |
| Interpretations in sections 1, 4 and 6 (a guide for Japanese materials makers, the rise in certifications, revisions of the policies) | Inference | Our own reading of References 1 to 5 |
Last updated 10 October 2026 / Troy Technical
Figures in this article come from METI’s official website and published documents. Passages marked “Inference” are our interpretation of the primary sources.