Now, it is contemplating banning exports of tin and copper ore, too.
Indonesia export bans prompt tin price surge
Indonesian President Joko Widodo has been announcing from different forums that his country may stop the export of bauxite next year, copper ore in 2023 and tin in 2024.
On the heels of the announcements, the tin price has surged,MetalMiner Insightsdata shows. (Subscribers can find additional tin and copper analysis in the nextMonthly Metal Outlookreport, which will be released Wednesday, Dec. 1.)
The LME three-month tin price closed Monday at $39,450 per metric ton. The price is up 6.6% month over month.
For long, Indonesia has been a major exporter of metal ores, mostly to Asian countries, including China and Japan. The ban on nickel exports had triggered investments, mostly from China, into Indonesian nickel processing.
As part of efforts to improve the countrys external balance & attract investments into the resource processing industry, Indonesia may stop tin exports in 2024, the Indonesian President reiterated last week at the Indonesian central banks annual gathering.
The president has made similar statements in recent public appearances about the countrys long-term dependence on raw commodities, reducing its export earnings and employment opportunities.
The idea is that the ban on exports of raw commodities would attract investments in downstream industries. It would also improve Indonesias trade and current account balances.
The nickel ore ban has alreadyled to protestsby the European Union. The latter has filed a complaint with the World Trade Organization.
The Indonesian president, though, remains unfazed by the move, keeping his eye firmly on foreign investments.
Copper concentrates from Indonesia go mainly to China, followed by Japan. But exports accounted for just 2.1% of Chinas total imports of 19.2 million tons in January-October this year.
According to a report by SMM, the countrys supply of copper concentratewould be sufficientfor at least two years, which would reduce the impact of the potential ban on Indonesian copper exports.
U.S.-based minerFreeport-McMoRan, operator of Indonesias massive Grasberg copper mine, has decided to build a copper smelter in east Java province. This was part of the commitment Freeport-McMoRan had made to the Indonesian government in 2018 to extend its mining rights at Grasberg. The smelters construction is likely to end by December 2023.
This and other smaller smelters means Indonesia will have the ability to process all its copper concentrates into refined copper. As such, it will not need to export copper concentrates after 2024.
By AG Metal Miner