Kuala lumpur: The development of the rare earth element (REE) industry in Malaysia will undergo a stringent engagement process at both federal and state government levels. The aim is to ensure that the REE value chain is developed within the country, as stated by Minister of Plantation and Commodities, Datuk Seri Johari Abdul Ghani.

According to BERNAMA News Agency, Johari emphasized that the federal government will consider environmental aspects and the export of REEs, while the state government will be directly involved in granting mining permissions. He noted that Malaysia is keen on preventing arbitrary exports as the country seeks to build upstream, midstream, and downstream REE activities domestically. Johari highlighted that Malaysia currently lacks the expertise and technology to carry out REE mining on a commercial scale.

Addressing concerns over potential foreign exploitation of Malaysia’s REE resources, Johari, also acting Minister of Natural Resources and Environmental Sustainability, assured that the country has a robust legal framework and approval process. He stated that investors must adhere to Malaysia’s procedures, which consider factors such as location, reserve value, potential for factory construction, job opportunities, and state revenue.

Johari further explained that due to a lack of domestic expertise, Malaysia has had to rely on external technology for REE development. He noted that Malaysia does not yet possess a processing plant capable of commercial-scale separation of high-value REEs. Currently, China dominates the global value chain for REE processing and separation and controls the export of related technology.

Using the example of mining in Perak, Johari pointed out that local companies have partnered with Chinese firms for mining activities, with the minerals being sent to China for processing. He mentioned that the state government only receives tributes, a situation Malaysia aims to avoid in the future.

Johari acknowledged that Malaysia faces challenges in developing a complete value chain from mining to value-added product production. Additionally, the country lacks comprehensive data on REE resources, including their location, quantity, grade, and land use status. He stated that initial estimates by the Department of Mineral and Geoscience Malaysia remain at the inferred resource level, necessitating further studies for economic and sustainable mining.

In response to these challenges, Johari outlined the government’s phased strategy for developing the rare earth industry. This includes a short-term focus from 2025 to 2027, a medium-term plan from 2027 to 2030, and long-term goals beyond 2030. He mentioned the maintenance of a moratorium policy on crude exports in the short term to encourage domestic investment, refining, separation, and production of value-added products.

Reports indicate that Malaysia’s non-radioactive REE resources are located across ten states, including Johor, Kedah, Kelantan, Melaka, Negeri Sembilan, Pahang, Perak, Sarawak, Selangor, and Terengganu.