Australian nickel set for boost after Indonesia bans nickel exports
Until the ban, Indonesia supplied over a fifth of the world’s nickel at an estimated 400,000 tonnes of contained metal. Chinese nickel pig iron producers imported more than 30 million tonnes of nickel ore from Indonesia last year and China’s aluminium smelters rely on Indonesia for 20% of their feedstock.
Indonesian President Susilo Bambang Yudhoyono signed the new ban into law on Saturday, causing ire in the country’s resources sector.
According to the latest rules under the ban, base metals including copper, manganese, lead, zinc and tin will be allowed to be exported in concentrate until 2017.
FT.com quoted Gayle Berry, base metals analyst at UK bank Barclays earlier this week as saying the ban “is the biggest supply risk facing base metals in a long time. The market has been very complacent, thinking the Indonesians would backtrack.”
Privately owned Ibris Nickel last week announced it will cease operations in Indonesia laying off 1,400 workers at its 2 million tonne per year mine. The nickel industry employs some 200,000 Indonesians across hundreds of small scale operations.
The South China Morning Post reports the Indonesian Mineral Entrepreneurs Association said it planned to challenge the ban in the Supreme Court and Constitutional Court while Reuters reports almost 30,000 mine workers have been laid off, sparking protest in the capital Jakarta:
“We call on all mining workers to prepare to go on the streets and swarm the presidential palace if the government goes ahead with the implementation of the ban,” said Juan Forti Silalahi of the National Mine Workers Union in a statement earlier on Saturday.