Toyo Engineering’s Surge Burns Shorts as Japan Seeks Rare Earths

Pressure is mounting on short sellers of Toyo Engineering Corp. as the stock extends last year’s surge amid speculation that rising tensions with China will push Japan to seek alternative sources of rare earths.

Shares of the Japanese industrial plant builder have doubled since the start of January, extending last year’s gain of more than 300% amid hopes that Prime Minister Sanae Takaichi’s government will step up efforts to counter China’s dominance in rare earths. Toyo Engineering is involved in a project to develop technology to recover rare-earth muds from the seabed.