China lifts rare earth export ban to Japan: Media

China has resumed accepting customs clearance applications for exports to Japan of rare earth metals, Japan's Asahi newspaper reported, easing concerns about a possible de facto ban on shipments of the vital elements.

Asia's two biggest economies have been feuding over Japan's detention of a Chinese fishing boat skipper whose trawler collided this month with two Japan Coast Guard ships near uninhabited islands in the East China Sea that both sides claim.

Japan released the skipper on Saturday, but a war of words has continued as each side insists the other is to blame. The islands - called the Diaoyu in China and Senkaku in Japan - that both sides claim, are near rich fishing grounds and potentially large oil and natural gas reserves.

China has denied imposing a ban on the rare earth metals, essential for a raft of products from electronics to cars, in retaliation for the fishing boat captain's arrest, but Japan's government was investigating the situation. Officials were not immediately able to comment on Wednesday's media reports.

A trade ministry official said on Tuesday that Japan had not concluded that restrictions had been imposed, but some companies had been complaining.

Japanese prosecutors' decision to release the Chinese skipper followed mounting worries about worsening ties between the region's two biggest economies and high-profile pressure from Beijing, including a halt to top level diplomatic contact.

China accounts for about 97% of the world's total production of rare earth elements, about half of which are exported to Japan. A ready supply of them is crucial to manufacturing industries such as electronics and automobiles that keep Western economies ticking.

Japanese economics minister Banri Kaieda said in an interview with the Financial Times that the de facto ban would push Tokyo to see new sources of the strategic metals.

"(It seems) there's a need to put effort into developing substitute products," the newspaper quoted him as saying, adding that Tokyo would also look to develop alternative sources of the supply for rare earths.