KUALA LUMPUR (July 7): Lynas Rare Earths Ltd has partnered with South Korea’s JS Link Inc to build a rare earth permanent magnet manufacturing facility in Kuantan.

Under the agreement, JS Link will build and operate a factory near Lynas’ existing facility in Kuantan with an annual production capacity of 3,000 tonnes of neodymium-iron-boron permanent sintered magnets, according to a statement from Lynas. The factory is expected to create up to 400 jobs.

The supply agreement, which runs until January 2038, will see Lynas become the exclusive supplier of rare earth materials to JS Link’s existing magnet plant in South Korea as well as the planned Malaysian facility.

Rare earths have taken centre stage as China, which has long dominated the supply of the critical materials, tightens its control amid global trade tensions. Lynas’ facility in Pahang is now the only non-Chinese commercial producer of the minerals used in electric vehicles and guided missiles.

The agreement follows a memorandum of understanding signed by the two companies in July last year.

The magnets produced at the upcoming new factory are intended to serve the automotive, wind energy and electronics manufacturing supply chains in South Korea, Malaysia and other key markets. 

For Lynas, the company will invest about A$50 million (RM142 million) for a stake in the South Korean company to support the construction of the facility.  

The partnership combines Lynas’ rare earth processing expertise with JS Link’s magnet manufacturing capabilities, supporting the group’s objective to expand into the metal and magnet supply chain outside China, said Lynas interim chief executive officer Pol Le Roux.

JS Link, a biotechnology firm, also has a division producing up to 1,000 tonnes of magnet. The company is now distributing samples and in the process of preparing for mass commercial production.