Malaysia Weighing Limited Return Of Raw Rare-earth Exports Amid Growing Foreign Interest, Deputy Minister Says

KUALA LUMPUR, Aug 3 — Malaysia is considering allowing limited exports of unprocessed rare earths under strict conditions as foreign interest in the country’s mineral deposits grows, business daily Bloomberg reported.

The move would mark a partial shift from a moratorium introduced in 2024 to encourage domestic processing and retain more value within Malaysia.

Deputy Natural Resources and Environmental Sustainability Minister Syed Ibrahim Syed Noh said authorities were assessing whether to ease the restrictions amid pressure from state governments and investors.

“The pressure is already there, from Malaysian states and investors,” he told Bloomberg.

“They are knocking at the doors already,” he said, referring to interest from the United States, Australia, France and India.

Syed Ibrahim said any renewed exports would be tied to investment in Malaysia and technology transfers, and should be used for research and development overseas. He gave no timeline for a decision.

Malaysia is seeking a larger role in the rare-earth supply chain as major economies look for alternative sources of minerals used in cars, defence equipment and consumer goods.

The country is already home to an expanding refinery operated by Australia’s Lynas Rare Earths Ltd, one of the few major producers outside China. The facility processes ore imported from Australia, while Lynas and other companies have shown interest in Malaysian deposits.

“Diversification is particularly important,” Syed Ibrahim said. “We want to mitigate the risk of over-reliance on technology from a single source.”

He said Malaysia was “on track” to become a regional hub for critical minerals by 2030 and was seeking investment across the supply chain.

Malaysia’s recognised rare-earth reserves account for about 1 per cent of the global total, compared with China’s share of more than 50 per cent, according to Hannam & Partners Research.

Berjaya Corp Bhd is among the local groups exploring projects, while France’s Carester SAS plans to build a rare-earth separation plant in Perak with Malaco Mining Group.

Syed Ibrahim said Malaysia would continue engaging Chinese companies because of their technological expertise.

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

Lynas has separately faced political scrutiny over a four-year agreement to supply the US military. A parliamentary committee is examining whether the deal has implications for Malaysia’s foreign policy.

Syed Ibrahim said he had not seen the committee’s 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 up the action after that,” he said.

Malaysia has 16.1 million tonnes of inferred rare-earth reserves, previously estimated by the government to be worth RM970 billion.

Many of the deposits are in protected forests. Syed Ibrahim said the government was mapping them and studying ways to extract the minerals without damaging biodiversity.