SYDNEY: Shares in Australia's Lynas Corp jumped as much as 5.1 per cent on Tuesday after the company said a Malaysian court had dismissed a challenge by protesters against its long-delayed rare earth processing plant.

The $800 million rare earth plant - the world's biggest outside China - finally began production in November after lengthy environmental and safety disputes with local residents and the Save Malaysia Stop Lynas (SMSL) protest group since construction began two years ago.

Lynas said the Federal Court had dismissed an appeal by SMSL to seek a judicial review of the decision to grant it a temporary operating licence.

"SMSL has now exhausted all avenues of appeal in the Malaysian Courts with respect to this challenge," Lynas said in a statement late on Monday.

The plant in Kuantan is considered important to breaking China's grip on the processing of rare earths, which are used in products ranging from smartphones to hybrid cars.

Lynas shares rose to a high of A$0.615 and last traded up 4.3 per cent at A$0.61, half the level it was a year ago.-- Bernama