Australian rare earth producer Lynas stated on Monday it’s on track to have its Malaysian operating license renewed as it flagged soft demand from China amid a slip in quarterly sales income.
Lynas conflicts with Malaysia over the removal of low-level dangerous waste produced by its processing factory in the country; however, said last week it was assured of resolving problems about its permit before a Sept. 2 deadline.
“The earliest we have ever had a formal renewal of our license was a few weeks before the renewal date,” Chief Executive Amanda Lacaze told an analyst briefing Monday
Lynas, the most important rare earth’s producer in the world outside China, mentioned in its quarterly report that Malaysia’s deputy environment minister had instructed parliament conditions for the renewal can be determined by Cabinet and declared mid-August.
Lynas said in June it was stockpiling production of rare earth ingredient Neodymium Praseodymium (NdPr) for strategic clients amid Sino-U.S. trade spat that have stoked concerns that primary producer China could originate rare earth’s exports.
Sales income for the June quarter dropped 4.6% to A$87.5 million ($60.5 million), lower than the A$91.7 million it earned for the same interval in 2018, the company stated. Shares in Lynas had been down by 3.2% at A$2.58 by 0211 GMT.
A lower average selling value had hit sales for NdPr, which is used to make strong magnets for e-vehicles and wind generators.
“Demand in China is gentle. The car market there is not rising, which is a huge (demand), driver. There’s a real concern there concerning the effect of the trade conflict,” Lacaze mentioned.