Japan to slash use of a heavy rare earth as China tightens grip

TOKYO (Reuters) - Japan aims to cut domestic consumption of a heavy rare earth used widely in hybrid cars and electronics by 30 percent over the next two years as China keeps a tight grip on exports of the material, known as dysprosium.

China ratcheted up export controls on the rare earth, mainly used in high-powered magnets, early last year, sending prices 10 times higher to around 3,000 yen per tonne by the middle of 2011, though it is now trading at about 2,000 yen.

China produces about 95 percent of global rare earth supplies, but says that excessive production is depleting its reserves and damaging its environment...