Murata Manufacturing, a $46 billion Apple supplier, will separate its rare earths supply chain from China over the next three years. The Japanese electronics giant supplies 40 percent of the world's multilayer ceramic capacitors (MLCC), components essential for devices from iPhones to data centers.

Since President Norio Nakajima took over in 2020, Murata has been creating distinct US and China supply chains as tensions between the superpowers rise. While most separation is complete, rare earths remain an exception since they still must be purchased from China. The move comes amid escalating trade disputes, including China's January ban on dual-use goods exports to Japan and restrictions on dozens of Japanese companies last month.

The company is identifying new rare earths sources outside China, though testing and certification will take about three years before mass production. Murata's China business, which accounted for 48 percent of revenues last fiscal year, has declined from 60 percent in 2021 as customers shift production to Vietnam, Cambodia, and India.