Malaysia weighs conditional raw rare earth exports

Malaysia may allow some exports of raw rare earth, lifting a ban in place since 2024, Deputy Natural Resources and Environmental Sustainability Minister Syed Ibrahim Syed Noh said.

He told Bloomberg that Putrajaya is facing pressure from Malaysian states and investors, including those from other countries.

"They are knocking at the doors already,” Syed Ibrahim (above) said, in reference to interest from the US, Australia, France, and India.

However, he declined to provide a timeline for the decision-making process.

In September 2023, Bernama cited Prime Minister Anwar Ibrahim as saying, during his presentation of the mid-term review of the 12th Malaysia Plan (12MP), that the government is formulating a policy to ban the export of unrefined rare earth in order to protect domestic returns.

This was enforced via a moratorium that came into force on Jan 1, 2024.

Last year, the Natural Resources and Environmental Sustainability Ministry said in a parliamentary written response that a short-term moratorium was imposed on the export of rare earth elements (REE) from 2025 to 2027 to develop the midstream industry, according to Bernama.

Since 2024, Putrajaya has been working on the framework for its National Mineral Policy 3, which will replace its predecessor introduced in 2009.

Subject to conditions

Commenting further, Syed Ibrahim said exports will be subject to conditions, such as investments into Malaysia and technology transfers, adding that the exported materials should be used for research and development.

He also declined to comment on whether the government will cancel the agreement it made with the US during President Donald Trump's visit last year, which prevents Malaysia from imposing any quotas on the export of critical minerals and rare earth to the US.

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When asked about the parliamentary committee scrutinising Australian company Lynas Rare Earths Ltd's deal with the US Department of Defense, Syed Ibrahim said he is unaware of any findings.

“I think Malaysia, as a country which is supporting Palestine, would look into it and see whether there are any irregularities or something which is against the foreign policy of Malaysia, and can take action after that,” he added.

Lynas' deal with the US had caused pro-Palestine advocates to express concerns over Malaysia’s complicity in military activities linked to violations of international humanitarian law.

Lamp facility

Lynas has a facility - the Lynas Advanced Materials Plant (Lamp) - in Gebeng, Pahang, which produces 95,000 metric tonnes of lanthanide concentrate a year with minerals sourced from Mt Weld in Western Australia, where they are processed and then shipped for refining and separation into rare earth oxides in Malaysia.

Lamp is not only capable of producing light REE but is also the only significant producer of heavy REE outside China, and therefore the only producer not subject to China’s export controls on critical minerals.

REE refers to a group of 17 metals and their oxides used in various high-tech applications. They are of strategic importance in the ongoing trade war between the US and China.

Last month, Lynas announced plans to expand its operations in Malaysia through the development of a rare earth permanent magnet factory in Kuantan, Pahang, in partnership with South Korean technology company JS Link.

Engagements with China

Meanwhile, Syed Ibrahim noted that efforts to increase China's involvement in mining and processing have met with limited success.

However, he said Putrajaya will continue its engagement as it cannot ignore China’s experience and technological advantages.

“If China wants to share the technology, it would be a win-win for all of us,” he commented.

Syed Ibrahim said Malaysia is estimated to have 16.1 million tonnes of rare earth deposits, projected to be worth RM970 billion.

These are mostly found within protected forest areas, he said, adding that studies are ongoing to map their locations as well as develop environmentally-sensitive ways to extract them.

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