Nickel climbs to two-week high on Indonesia ore export ban
time:2014-01-14 08:59 click:
Jakarta: Nickel climbed to the highest level in two weeks on fears that Indonesia’s ban on mineral ore exports will cut global nickel supplies while allowing Freeport-McMoRan Copper and Gold Inc. to keep exporting copper concentrates.
Indonesia’s President Susilo Bambang Yudhoyono signed a regulation implementing the ore ban, energy and mineral resources minister Jero Wacik told reporters on 11 January, after a meeting of government ministers in West Java. The rule, which went into effect after months of wrangling, prohibits all raw ore exports and permits shipments of minerals that are processed or refined in the country.
While the decision eases concern copper shipments will be disrupted, it’s pushing up nickel prices as Indonesia is the world’s biggest mined producer. The ban is part of a wider policy in Southeast Asia’s largest economy to boost state revenue by turning Indonesia from an exporter of raw commodities into a manufacturer of higher-value products.
“The law should clearly be bullish for nickel, as we should expect to see significant lower volumes of ore flow from Indonesia to China,” David Wilson, an analyst at Citigroup Inc. in London, said after the decision.
The country accounts for 18% to 20% of global nickel supply, 9% to 10% of aluminum from bauxite and 3% of copper, Goldman Sachs Group Inc.estimates.
Indonesia’s President Susilo Bambang Yudhoyono signed a regulation implementing the ore ban, energy and mineral resources minister Jero Wacik told reporters on 11 January, after a meeting of government ministers in West Java. The rule, which went into effect after months of wrangling, prohibits all raw ore exports and permits shipments of minerals that are processed or refined in the country.
While the decision eases concern copper shipments will be disrupted, it’s pushing up nickel prices as Indonesia is the world’s biggest mined producer. The ban is part of a wider policy in Southeast Asia’s largest economy to boost state revenue by turning Indonesia from an exporter of raw commodities into a manufacturer of higher-value products.
“The law should clearly be bullish for nickel, as we should expect to see significant lower volumes of ore flow from Indonesia to China,” David Wilson, an analyst at Citigroup Inc. in London, said after the decision.
The country accounts for 18% to 20% of global nickel supply, 9% to 10% of aluminum from bauxite and 3% of copper, Goldman Sachs Group Inc.estimates.