The Indonesian mining industry is discussing export quotas for nickel ore and bauxite, after the government imposed a ban on all unprocessed minerals from January 12.
“There are export quotas being discussed for bauxite and nickel ore,” Syahrir Abubakar, executive director of the Indonesian Mining Association, said on Tuesday January 28. He added that the talks
include asking the trade ministry to allow for export quotas of 20 million tpy of nickel ore and 15 million tpy of bauxite.
However, if these industry proposals are allowed – and the government reconsiders its export ban on minerals such as nickel ore and bauxite – the price of these commodities will be put under pressure, he added.
Indonesian mineral exports have come to a complete halt as the country’s mining industry awaits details on export quotas for processed minerals and concentrates to be issued by the government.
The Indonesian government has said that export of unprocessed minerals such as bauxite and nickel ore is not allowed. Indonesia’s mining ministry regulations define processing requirements for exports of minerals including copper, nickel, bauxite, iron ore, lead, zinc, silver and gold.
The minimum processing requirement before export for bauxite is 90% in the form of chemical grade alumina (CGA) or 98% in the form of smelter grade alumina (SGA). For nickel the processing requirement is 4% nickel pig iron, 70% nickel matter and 10% ferro-nickel.
China is the largest importer of Indonesian nickel and a major buyer of Indonesian bauxite.
In 2013, China imported 41.1 million tonnes of nickel ore from Indonesia, up 22.2% from 2012. China’s nickel ore inventory of more than 24 million tonnes is expected to cushion the impact of the ban.
Indonesia’s state-owned miner PT Antam has said it will produce nickel ore for its own use only following the government’s ban on minerals exports, with 2014 production expected to fall.
Ibris Nickel has stopped nickel ore exports.
These recent talks on nickel ore and bauxite underline the debate on whether the ban will be implemented in a strict fashion or the rules will be relaxed after the elections this year.