Indonesia's Nickel Downstream Industry: Trapped in the Import Web?

By Editorial Team 26/03/2024
Smelter
Summary

In response to the shortfall in domestic supply, Indonesia is considering importing nickel ore from the Philippines and Australia to meet the needs of its smelters. Djoko Widajatno, the Executive Director of the Indonesian Mining Association, highlighted the pressing demand for nickel ore for domestic smelting, estimated at 234.5 million tons annually. However, the Energy and Mineral Resources Ministry has only approved 107 work and budget plans (RKAB) for nickel mines, projecting a total production of 152.61 million tons for 2024-2026.

Djoko emphasized that the escalating demand for nickel ore could be offset by the global surplus production in 2023, reaching 275 million wet metric tons. "We have recently seen some nickel ore imports," he stated on Mar. 21. Rizal Kasli, Chairman of the Association of Mining Experts, also expressed concerns that the 107 RKABs for nickel mining might not suffice to prevent a potential national nickel ore deficit in 2024. The shortage in supply to Indonesian smelters is expected to impact nickel ore prices. "This will inevitably drive nickel prices higher," he added.

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