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[SMM Express] Indonesian Ministry of Mines plans to revise domestic price rules for nickel mines to ensure that smelters comply with government benchmark prices
Oct 25,2019 15:11CST
The content below was translated by Tencent automatically for reference.

SMM10, March 25: recently, according to Indonesian local media reports, on October 24, an official of the Indonesian Ministry of Mines revealed that the Indonesian Ministry of Mines was revising a rule stipulating the domestic price of nickel mines to ensure that smelters comply with the government benchmark price. Earlier, nickel miners complained to the government that domestic smelters had pushed down ore prices, making prices in the domestic market extremely unattractive.

Yunus (Yunus Saefulhak), mining director at the Ministry of Energy and Mineral Resources, said in an interview late Wednesday that the government's goal is to issue a revised version when the ban on nickel ore exports is issued in January 2020. Indonesia's goal is to build a fully integrated nickel industry by processing ore into metal and chemicals for batteries used in electric vehicles (EV) and building electric vehicles locally, but policy changes have had an impact on domestic and internal nickel trading.

The government plans to revise the rules to make the benchmark price the lowest price that must be used in the ore trade, Saefulhak said. Indonesia introduced a ban on the export of raw nickel from an earlier timetable in January 2022 as part of the Government's efforts to promote the development and expansion of the onshore smelting industry. "We already have a benchmark price, but we haven't complied with it," Saefulhak said. " "We will make the wording stronger so as not to see any more cases of lower than normal prices," he said. "

The government wants to avoid problems caused by low ore prices, he added, because miners tend to cut safety and environmental management costs when prices are low. As of July, the average price of low-grade nickel was $15 per wet tonne, while the government benchmark price fluctuated between $25.40 and $28.96 per wet tonne between January and July, according to the nickel miners association (APNI). The government is also reviewing the formula for calculating Beckmark prices to take into account mining and smelting costs, Saefulhak said. "We need to find a balance because we also want to keep prices attractive to smelters investing in Indonesia," he said. "

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