The low level naturally occurring radioactivity in the lanthanide concentrate imported from Mt Weld into Malaysia is the issue and therefore subject to limits. While Lynas obtained increases to import limits, the regulators have so far been steadfast in refusing to increase the processing limits. While they have not come out and said so, it's pretty clear that they do not want to be seen as permitting the further build up of WLP (radioactive) in the absence of a PDF.
Enter KAL cracking and leaching, during which the radioactivity will be removed and a carbonate sent to Malaysia. No radioactivity, no processing limit. Now that the PDF has been approved, things could change re the processing limit in Mal.
The issue for Lynas now, and one of the most exciting to look fotward to, is to match Kal C&L capacity with an increase in SX capacity, as demand has grown faster than expected and even Lynas NEXT rate of 7200t NDPR is not going to be enough. Eagerly anticipating news in coming days or weeks re plans to grow SX capacity.
LYC Price at posting:
$11.24 Sentiment: Buy Disclosure: Held
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