I assume you're talking about Grand Sumo, since you're here in the Ozumo forum. I'm an American and don't speak Japanese so although I've been on many extended trips to Japan I've never really gotten to have this conversation with Japanese folks.
Here's what I can say. There are conspiracy theories about the JSA and the Japanese in general being prejudiced against foreign wrestlers, especially Mongolians. But if you look at the history, there isn't really any evidence to substantiate that the JSA limits the progression of foreigners at all. And while, yeah, there are 'bad apples' in every society, I don't get any of that vibe when I try to talk sumo with the Japanese side of my family.
As for why Mongolians do so well, there is some general consensus on that. The JSA has a rule that a heya (stable/training facility) can only have one foreign wrestler, which limits Grand Sumo to about 100 foreign wrestlers total. So while, as a Japanese, pretty much anyone who really wants to do sumo can get in, as a foreigner you really need to be the best of the best to get into a heya. Since most of the foreign wrestlers currently are from Mongolia, the result is it seems like Sumo is full of Mongolian superstars. Which is true, but as a fan you need to understand that, for better or worse, it was set up to be that way.
Youtuber SumoStew put out a video recently called Why You Don't See Hawaiian Sumo Wrestlers Anymore that talks about the rise of Mongolian wrestlers. Check it out if you want: