Jakarta. Indonesia has reached an agreement on rules governing exports of critical minerals containing rare earth elements, with the government clarifying that an export ban will apply to pure rare earth products rather than other commodities that contain trace amounts of the minerals.

Dudung Abdurachman, chief of staff to President Prabowo Subianto, said Monday that pure rare earth products would be prohibited from export, while derivative commodities such as nickel and tin containing trace amounts of the minerals would remain eligible for shipment overseas. 

“For rare earth elements in pure form, they cannot be exported,” Dudung told reporters at the presidential office complex in Jakarta. “But for derivatives, such as nickel and tin, there is inevitably some content, even if only 0.0-something percent.”

The government is still working to establish specific thresholds for rare earth content in exportable products. The Coordinating Ministry for Economic Affairs held a meeting Monday with 47 representatives from 15 government institutions, academics, industry associations and companies to discuss the proposed limits.

The talks cover definitions of associated minerals, maximum concentrations for individual elements, laboratory testing methods, verification procedures and guidelines for issuing surveyor reports.

The agreement is intended to provide a transition framework for exporters, surveyors and customs officials while the regulations are finalized. The government is also seeking a legal opinion from the Attorney General’s Office to strengthen legal certainty during the transition, Dudung said.

Export Shipments Unblocked
The clarification comes after uncertainty over the new rules delayed export clearances for a large number of shipments. More than 100 export vessels that had been held up because of differing interpretations during the verification process can now resume operations, Dudung said.

The results of inspections by state-owned surveyor Sucofindo will serve as the reference for customs authorities and other relevant agencies in clearing the shipments, he said.

“Ultimately, more than 100 export vessels that had been held up have started operating again,” Dudung told reporters at the presidential office complex in Jakarta on Monday.

Coordination led by the Presidential Staff Office on July 31 also cleared the way for Sucofindo to issue 85 surveyor reports that had been delayed after shipments were suspected of containing associated minerals, according to Dudung.

Most of the delayed reports involved strategic commodities including alumina, copper cathodes and nickel-derived products

The government wants enforcement to remain firm but said companies that comply with existing rules should not be penalized because of differing interpretations among agencies.

Enforcement must be based on clear regulations, reliable data, accountable laboratory tests and coordination between government institutions, Dudung said.

The government also said mining products containing naturally occurring radioactive material, or NORM, may continue to be exported as long as they meet applicable limits and comply with testing, safety and monitoring requirements.

Building a Rare-Earth Supply Chain
The regulatory push comes as Indonesia seeks to establish a domestic supply chain for rare earths, a group of minerals critical to industries ranging from semiconductors and electric vehicles to batteries, renewable energy and advanced defense technology.

Indonesia has estimated rare-earth oxide reserves of about 350,000 metric tons, according to government data. That compares with about 44 million tons in China, equivalent to 48% of global reserves, followed by Brazil with 21 million tons and Australia with 6.3 million tons, accounting for 23% and 7%, respectively.

Although Indonesia's reserves are relatively modest, the government is seeking to recover rare earths that occur as byproducts of its mining industry, particularly tin, and process them domestically rather than export them in raw or minimally processed form.

State-owned tin miner Timah (IDX: TINS) broke ground in May on Indonesia's first rare-earth research and processing pilot plant in Tanjung Ular, West Bangka, in the Bangka Belitung province. The project, developed with newly minted Perusahaan Mineral Nasional (Perminas), is designed to process tin-mining byproducts known as SHP into higher-value critical minerals.

Dudung said Indonesia also needs to expand exploration, integrate mineral-resource databases, strengthen research and technical expertise, manage environmental impacts and attract investment in separation and refining technology.

The government’s longer-term goal is to capture more value from rare earths by developing a domestic processing industry, while balancing export activity with tighter state oversight.

“The Presidential Staff Office will continue to oversee coordination among ministries and agencies to maintain a balance between legal certainty, state oversight, business activity, investment, downstream development and national interests,” Dudung said. “Bureaucracy must be part of the solution, not a source of obstacles.”