KUALA LUMPUR (March 1): Malaysia’s ambition to unlock RM747 billion (according to government estimates) worth of rare earth elements (REE) embedded in the country’s hills and soil has recently come under the spotlight — and for good reason.
China’s ongoing public consultation on new regulations designed to protect its REE industry could add to existing restrictions on magnet-making technology exports. This underscores the urgency for alternative sources of REE, fuelling optimism around Malaysia’s vast deposits at a time when the country seeks high-value sectors to spur investments and long-term growth.
Demand for these prized minerals, used in electric vehicle motors, wind turbines and even radar evasion coating for fighter jets, is surging worldwide.
Yet, technical setbacks, regulatory issues, and illicit mining threaten to keep REE’s potential locked beneath the surface — unless policymakers and industry leaders align to build a high-value downstream ecosystem.
Despite the headwinds, multiple parties remain hard at work to take advantage of the country’s vast REE resources. This includes local mining companies looking for a piece of the pie, as well as both the federal and state governments seeking to create value from what is described as a “national strategic mineral” in the National Mineral Industry Transformation Plan 2021-2030.
Now is an opportune moment to develop the ecosystem. According to news reports, the US has been exploring alternative sources, such as those in Ukraine, while the electrification boom drives strong demand for motors and turbines — all of which require super-magnets, which depend on REE to maintain compact and cost-effective motor sizes.
How would Malaysia address the issues in developing the sector, which includes the fact that abundant supply is located in forest reserves, and that rare earth mining technology is being restricted by industry leader China?
Find out in The Edge Malaysia weekly’s Cover Story 1, out now.
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