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Japan-South Korea rift

Japan suppliers fear lost sales as export controls target Seoul

South Korean companies add months of inventories and look for alternative sources

A Tokyo Electron plant: An executive at the chipmaking equipment builder worries that South Korean companies may shun Japanese suppliers to cut risk. (Photo courtesy of the company)

TOKYO/SEOUL -- With Japan set to delete South Korea from its list of trusted trade partners, manufacturers in both countries are bracing for wider disruptions to their cross-border supply chains.

The Aug. 28 removal will mean longer, more complex procedures for Japanese exports to South Korea. Some Korean companies are adding months of extra inventories of key materials and hinting they may find alternative sources, according to Japanese suppliers that spoke to Nikkei.

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