China awaits clarity on Indonesia Ni ore export policy

Posted on 26 March 2021

Chinese nickel market sources suggest that Indonesia probably won’t relax its ban on nickel ore exports anytime soon, given that any relaxation would impact operators of nickel refineries there.

“The ban on nickel ore exports is unlikely to be lifted despite the government’s reported easing of restrictions on the export of other mineral ores,” a market source in Shanghai said. “Any move regarding nickel ore will harm overseas investors in Indonesia that have invested a lot of money to develop new technology to further process such ore,” he explained.

The Shanghai source was commenting on a Reuter news report citing an Indonesian government document stating that requirements for unrefined mineral ore exports were being eased but the ban on nickel ore exports remains. 

The decision means that Indonesia will continue its ban on nickel ore exports, in place since January 1 2020, which aimed to encourage foreign investors to build nickel refining facilities within the country, enabling the export high value-added nickel products, Mysteel Global notes.

Other market watchers in China were more hopeful that the Ni ore ban would be reviewed. “The government (of Indonesia) may take a similar measure on nickel exports to boost economic growth, such as allowing some local mines to resume shipments over a certain period if they meet specific requirements to export nickel ore,” a market source in Southwest China’s Guangxi said.

China’s nickel ore imports from Indonesia declined sharply since January 2020 given the country’s effective ban, which resulted in further growth in the volumes imported from the Philippines, as Chinese nickel smelters and nickel pig iron (NPI) producers had to buy from other countries to fulfill their demand, Mysteel Global noted.

During 2020, China imported 3.4 million tonnes of nickel ore from Indonesia, well below the 23.7 million tonnes for 2019, while the cargoes imported from the Philippines increased by another 1.9 million tonnes or 6.3% on year to about 32 million tonnes, according to data released by China’s General Administration of Customs.

In parallel, China imported more nickel pig iron from Indonesia given the NPI smelting lines brought on stream in the country. The Customs data showed that China’s imports of Indonesian NPI reached 2.7 million tonnes in 2020, soaring by 1.36 million tonnes or 99.6% from the previous year.

Source : Mysteel Global