Reuters reported that processed rare earth exports from a Malaysian plant owned by Australia's Lynas Corporation could hit 8 billion ringgit a year from 2013 based on current prices as buyers chase supplies outside China.
Mr Matthew James Lynas executive VP of Strategy and Corporate Communication said that the forecast is a more than nine fold increase from earlier projections of 880 million ringgit in 2009 and would be the equivalent of about 1% of Malaysia's gross domestic product.
The Lynas Advanced Materials Plant in Malaysia's central state of Pahang is slated to begin production in September 2011 making it a key global supplier after top rare earths producer China last year imposed export quotas to retain resources.
Mr James said that Lynas is a key part of that supply response. Malaysia will become the go to destination for value added exports. Companies requiring rare earths would eventually locate on the east coast of Malaysia. Lynas is acting as a seed for future investments.
He said that by 2013, annual rare earth production from the Malaysian plant would hit 22,000 tonnes meeting roughly a third of total demand outside China. Today the market is about 120,000 tonnes to 130,000 tonnes. By 2013, that will probably grow to 150,000 tonnes globally.
Mr James said that most of that growth or most of that demand is inside China, but outside China markets by the time it will be about 70,000 tonnes.
Rare earths are crucial to production of high tech goods from fibreoptic cables to smartphones and electric cars. Prices stand at USD 120,000 a tonne. Big buyers such as Japan, the United States and Europe rely on these minerals and have been looking to cut their reliance on China that accounts for around 95 percent of global output.
Lynas' Malaysia plant will process rare earth concentrate shipped in from the firm's Mount Weld site in Western Australia. The site is scheduled to produce its first feed of ore in the week of March 31. That strategy has prompted green and social NGOs to warn Malaysia could become a dumping ground for radioactive by products from the refining process, creating health and environmental risks.
Mr James said that we have gone beyond the Malaysian regulations. The plant is being designed with health and environment perspectives in mind. We have the largest industrial waste water cleaning plant on the east coast of Malaysia. Lynas will install waste water and gas treatment systems government and company data shows. Malaysia's Department of Environment approved the Lynas project in 2008.
He said that the DOE will continue to come and check if the plant has been built according to that specification. After inter agency discussions the pre operational licence is supposed to grant after that point. Between now and September this year we are looking to receive that pre operational licence.
(Sourced from Reuters)
