Lynas Extends Japan Rare Earths Deal to 2038, Renews Malaysia License

Australian miner Lynas Rare Earths (ASX:LYC,OTCQX:LYSDY) has secured a long-term extension of its rare earth supply agreement with Japanese partners while also receiving a renewed operating license for its Malaysian processing facility.

The company extends its long-standing commercial agreement with Japan Australia Rare Earths (JARE) through 2038 and establishes firm supply commitments for key rare earth materials used by the Japanese industry.

Under the revised deal, JARE will purchase 5,000 tonnes per year of neodymium-praseodymium (NdPr) from Lynas while also committing to buy 50 percent of all heavy rare earth oxides produced by the company.

NdPr is a critical component in high-strength permanent magnets used in electric vehicles, wind turbines and other advanced technologies.

The agreement also sets a market-linked floor price of US$110 per kilogram for NdPr supplied to Japanese customers. If the price rises above US$150 per kilogram, Lynas and JARE will share the upside, with JARE receiving 30 percent of the price increase above that level, capped at US$10 million per year.

In total, Lynas will make up to 7,200 tonnes of NdPr available annually to Japanese industry under the marketing agreement, subject to no opportunity loss for the company.

“Lynas’ partnership with JARE has served both organisations well over the past 15 years,” Lynas CEO and Managing Director Amanda Lacaze said. “We are delighted that the revised 12-year availability and supply agreement with JARE will support both Japanese industry and the continued growth and development of Lynas.”

The long-term contract follows the company’s successful production of separated heavy rare earth oxides in 2025, marking an expansion of its product portfolio beyond light rare earth elements.

In a separate announcement, Lynas said its operating license for the Lynas Malaysia processing facility has been renewed for 10 years by Malaysia’s Department of Atomic Energy.

The license renewal, which takes effect from March 3, 2026, provides regulatory certainty for the company’s refining operations, one of the few rare earth processing hubs outside China.

The agreement also underscores Lynas’ strategic importance in the global rare earth supply chain. The company is widely regarded as the only large-scale producer of separated rare earth materials outside China, which dominates the sector from mining through refining and magnet production.

Beijing has repeatedly demonstrated its willingness to leverage that position, most notably during the 2010 China-Japan rare earths dispute, when rare earths shipments to Japan were temporarily halted amid territorial tensions.

Since then, China has continued tightening its grip on the industry through export controls, production quotas and consolidation of domestic producers, reinforcing concerns among Western governments and manufacturers about supply security.

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Securities Disclosure: I, Giann Liguid, hold no direct investment interest in any company mentioned in this article.