Govt easing moratorium to also encourage development of local facilities
KUALA LUMPUR: Malaysia has agreed to ease its moratorium on raw rare earth exports under strict conditions to attract investors and encourage the development of domestic processing facilities, says Datuk Seri Johari Abdul Ghani (pic).
The Investment, Trade and Industry Minister said the flexibility would be limited to research and development (R&D) activities, with companies required to commit to developing processing facilities in Malaysia within three years of receiving export approval.
He said potential investors remained reluctant to enter Malaysia’s rare earth elements (REE) industry without assurances of a stable domestic supply of raw materials.
“To attract these potential REE investors, the government has agreed to provide flexibility under the existing moratorium on raw REE exports through the Guidelines for Consideration of Applications for Raw Rare Earth Exports,” he said.
Johari said the ministry was prioritising investments in the midstream and downstream segments of the REE industry to maximise the economic value of Malaysia’s mineral resources.
“This is particularly in high-technology manufacturing, such as permanent magnets, advanced materials, electronic components and batteries.
“Malaysia needs to leverage strategic cooperation and technology transfers from domestic and international partners, including countries experienced in REE processing, to realise its aspirations of developing the industry.
“This will strengthen domestic capabilities across the entire value chain, from mining activities to the manufacturing of finished products.
“It will also position Malaysia as an important player in the global critical minerals supply chain,” he added.
Johari said this in a written parliamentary reply to Setiu MP Shaharizukirnain Abd Kadir who asked about the government’s position on a US$96mil (RM388mil) rare earth oxide supply agreement between Australia’s Lynas Rare Earths Ltd and the Pentagon.
Johari said Lynas Malaysia had clarified that the arrangement was a commercial matter handled directly by its subsidiary, Lynas LLC USA, and the US authorities.
“The company also informed us that the rare earth oxides supplied are intended for R&D in the permanent magnet manufacturing industry currently being explored by the United States,” he said.
He explained that Lynas Malaysia operated at the initial processing stage, separating raw rare earth materials mined in Australia into rare earth oxides for overseas metal manufacturers.
The resulting materials are subsequently supplied to magnet producers, with the finished magnets used in electric motors and other manufactured products, he said.
Johari said Lynas Malaysia’s operations complied with existing government policies, including licensing requirements and environmental impact assessment approvals.
