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NEWS UPDATES Asean Affairs        9  March 2011

Malaysia again tries rare earth refinery

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In the Geben Industrial Area on the outskirts of the northern industrial port of Kuantan, Malaysia, an army of workers is completing work on a rare earth refinery undertaken by the Australian mining company, Lynas.

If successful, Lynas says the refinery will be able to meet nearly one-third of the world’s demands for rare earth that will generate US$1.7 billion in exports starting in late 2012. That figure would represent 1 percent of the entire Malaysian economy.

The ore will not come from Malaysia but Australia. The slightly radioactive ore will come from the Mount Weld mine in the Australian desert, will be trucked to the port of Freemantle and placed on a container ship to Kuantan.

The ore leaves thousands of tons of low-level radioactive waste behind and Malaysia is familiar with that. Its last rare earth refinery, operated by the Japanese firm, Mitsubishi Chemical, is one of the region’s largest radioactive cleanup sites and it closed in 1992. The cost of the cleanup is $100 million.

The little-known world of rare earth became newsworthy in September 2010, when China imposed a two-month moratorium on shipments to Japan. Rare earths are used in many high-tech products.

Because of the radioactive waste, the world assigned rare earth refining to China but the Chinese moratorium on shipments to Japan has made many outside of China wary of the stranglehold that China has on the production of rare earth.

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It is commonplace in journalism to write two types of articles at the transition point between the year that has passed and the New Year. As this writer qualifies as an “old hand” in observing Thailand with a track record dating back 14 years, it is time take a shot at what may unfold in Thailand in 2011.

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