MELBOURNE/KUALA LUMPUR, Nov 12 (Reuters) - Shares in Australian rare earths producer Lynas Corp LYC.AX jumped 8 percent on Monday, after members of a committee auditing its Malaysian processing plant gave positive feedback about the plant to a public hearing.
Malaysia's government commissioned a review of the plant's environmental record in September, raising concerns about the future of the only major rare earths producer outside China and sending its shares tumbling. comments from members of Malaysia's audit committee at a weekend hearing were largely positive, according to local media and a broker report, which pushed its shares up more than 8 percent to a three-month high of A$2.38 by 0327 GMT.
Department of Environment director for the state of Pahang Rosli Zul said that water quality near the plant had improved over the past six years and that the factory had complied with all stipulated conditions, national news wire Bernama reported.
A public health specialist on the review board said no increases of cancer, eye inflammation or respiratory diseases had been found among people in the city of Kuantan, where the plant is located.
And a director at a government department of occupational health and safety said Lynas complied with all regulations, Bernama reported.
"Overall we found it to be positive for the company with five government agencies attesting to a glowing performance of its environmental, health, OH&S (occupational health and safety) and social track record," broker CLSA said in a report.
"We reiterate to investors this business is not at risk of closure."
The committee will file its report to the government on Nov. 27.
Interest in the case has been heightened by falling Chinese exports of rare earths in the second half of the year. In October, China's rare earths exports tumbled 37.4 percent from the previous month to their lowest in more than three years. is the world's biggest producer of rare earths, raising concerns it could crimp exports to the United States amid rising trade tensions.
However, China's Ministry of Industry said a low rare earth output quota for the second half of 2018 was due to an unusually high quota for the first half.