China has denied a report that it had blocked exports of rare earths to Japan amid a row between the regional heavyweights over a Chinese boat captain detained in disputed waters.

The commerce ministry denial came after The New York Times, citing unnamed industry sources, reported China had halted all shipments of the chemical elements to Japan.

Rare earths are essential for making iPods, electric cars, missiles and a range of other products.

"There is no such matter," Chen Rongkai, an official at the commerce ministry, told AFP on Thursday.

"I don't know where they got this. Everything is going on as normal."