KUALA LUMPUR (AFP) - Malaysian police were holding an Australian activist in custody after she was arrested together with 15 others protesting against a rare earth plant accused of producing radioactive waste.

Activist Natalie Lowrey was detained Sunday together with 15 Malaysians outside the plant of Australian miner Lynas Corp in the eastern state of Pahang, a district police official said.

The Malaysians have been released and could face charges later. But Ms Lowrey remains in custody for "investigations", the official said, declining to comment further.

Rare earths is a term used to describe 18 metals which are vital for many industrial and hi-tech processes such as the production of smartphones, hybrid car batteries, wind turbines, steel and low-energy light bulbs.

The Australian miner hopes the plant can help break the Chinese stranglehold on the market for rare earths. China accounts for 95 per cent of global production of rare earths and is home to 23 per cent of global reserves of such metals.

Malaysian anti-Lynas activist Tan Bun Teet said the arrests took place as some protesters broke through a police barricade when demonstrating against the plant, which they say produces radioactive waste that threatens the environment and the local population.

Mr Tan said the Syndey-based Ms Lowrey, who has helped anti-Lynas campaigners and arrived last week for Sunday's demonstration, may face deportation.

Lynas started processing rare earths in an industrial park outside the state capital Kuantan in late 2012 after a delay of more than a year due to strong local opposition.

Environmentalist groups have staged a series of protests against the Malaysian plant. Lynas has insisted the plant is safe, saying any radioactive waste would be low-level and safely disposed of.