In order to revive Indonesia’s processing industry by the President of the country, Susilo Bambang Yudono signed a law that prohibits from January 12, 2014 the export of unprocessed nickel, copper ores, as well as iron, manganese, lead, zinc, bauxite, ilmenite. In accordance with the law, ore export is provided for for three years, then for the ore processed and purified inside Indonesia, mainly nickel, an export ban is introduced. Some amendments are made to the law that are aimed at facilitating the fate of the mining companies in the country. Mitting elements in the Law Touch Freeport McMoran Copper and Gold and NewMont Mining Corp (USA).
The new law caused a commotion in the market, which led to an increase in prices for nickel ores, an increase in shares of nickel companies. So Western Areas shares (Australia) jumped 8.9 percent, Nickel Asia (Philippines) by 5.7 percent, Mincor Resources by 4.4 percent. China and Australia can win from the Indonesian ban, which will want to earn on the ban and strengthen their own reserves of raw bauxites. Financial Times writes that Traders expect interruptions with ore supply. In 2013, the price of Nickel fell by forty percent, the ban introduced by Indonesia by 2015 can lead to an increase in metal prices. For information, Indonesia takes 1st place in the world in the extraction of nickel ores. According to experts, this ban will positively affect the growth of the revenue of Norilsk Nickel.
Indonesia is the world’s largest coal exporter. Posco Korean Corporation with the assistance of Krakatau Steel (Indonesia) at the end of last year launched first of all an integrated metallurgical plant with a capacity of three million tons per year. The new plant will significantly reduce the need of Indonesia for imported flat semi-finished products, which will hit the companies in Russia, since recently Indonesia has been one of the largest buyers of slabs in Southeast Asia. In Indonesia in 2013, the consumption of steel per capita was fifty kilograms a year, traders suggest that in the near future the situation will not change. The Korean Corporation plans to build and launch in Indonesia the second stage of a metallurgical plant with a capacity of six million tons per year. The Ministry of Industry of Indonesia announced eight more planned metallurgical projects with a total capacity of 3.8 million per year. Indonesia is currently the largest supplier of bauxite and various ores in the world. At the same time, the share of world supplies of nickel ores is from 18 to 20 percent, from 9 to10 % of bauxite, 3 % copper.
