Rare Earth Processing Design: Bahlil Aims for Full Domestic Refining

The Indonesian government is currently preparing a strategy for the domestic processing of Rare Earth Elements (REE), following recent export blockages of mineral commodities caused by differing interpretations of regulations. Minister of Energy and Mineral Resources Bahlil Lahadalia stated that the government is designing a policy to ensure that all REE processing will eventually be carried out within the country. “Rare Earth Elements are being designed, some have even been started by Perminas. We want in the future all processing to be done domestically,” Bahlil said in Jakarta, as quoted on Monday (10/8/2026).

This development comes after the Presidential Staff Office confirmed that the export blockage of mineral commodities, which arose from differing interpretations of the REE content rules, has been resolved. The blockage was linked to Trade Minister Regulation No. 6 of 2026, which prohibits the export of REE with a total of 17 elements at a purity of less than 99%. Business operators had argued the ban should only apply if REE was the main commodity, not a by-product, especially as Indonesia currently lacks the technology for REE extraction.

Presidential Chief of Staff Dudung Abdurachman, who led the release of alumina hydroxide and alumina oxide exports from Pontianak’s Dwikora Port, stated that cross-ministerial coordination successfully overcame the regulatory hurdles. As a result, 85 previously delayed surveyor reports were issued, allowing over 100 export vessels carrying nearly 400,000 tonnes of mineral commodities, valued at approximately Rp2.2 trillion, to proceed. Dudung emphasised that the government remains committed to legal certainty and oversight, with all export commodities still required to meet testing standards and technical provisions. The Presidential Staff Office will continue to oversee regulatory improvements and inter-agency coordination to facilitate exports and accelerate downstream mineral processing.