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Since 2010, Indonesia has repeatedly raised the topic of resource export bans to develop its domestic processing industry, aiming to boost employment and economic growth. Starting two years ago, the issue of banning copper concentrate exports in Indonesia gained significant attention. The country has expanded one smelter and built two new smelters to ensure domestic consumption of its mineral resources.
According to SMM, PT FI's Manyar smelter began operations in September 2024 but delayed production recovery to mid-2025 due to a fire accident in October. In 2024, PT Gresik smelter expanded by 42,000 mt, and PT Amman smelter commenced operations on January 16, 2025. By 2025, Indonesia's three smelters will collectively form a capacity of 1.044 million mt of blister copper. Judging from the progress of smelter construction, Indonesia has strong incentives to ban copper concentrate exports in 2025 to supply its domestic smelters.
However, recent foreign media reports indicate that Freeport-McMoRan has requested the Indonesian government to allow it to export 1.3 million mt of copper concentrates until the end of this year. Indonesia has permitted Freeport-McMoRan to export copper concentrates but imposed higher export taxes as a penalty. According to SMM, feedback from a trader indicates that as of today, Indonesia has not yet approved copper concentrate export permits, and traders are still waiting for approval. Additionally, information from a miner suggests that copper concentrate export permits have not been approved but are likely to see progress soon.
SMM believes that since last year, Indonesia has faced significant copper concentrate inventory backlogs, unable to export. This has resulted in high business and financial costs for miners and traders. Meanwhile, domestic demand from smelter construction projects has been delayed and further hindered by production accidents, preventing demand from being released. Under dual pressures, the Indonesian government may have to temporarily relax raw material export permits or wait until all three smelters are operational before banning copper concentrate exports.
In 2024, China imported 550,000 mt of copper concentrates from Indonesia, while China's total copper concentrate imports for the year reached 28.1646 million mt. Indonesia's supply accounted for only 1.95% of China's copper concentrate imports. Although Indonesia's copper concentrate exports contribute minimally to China's regional supply-demand balance for copper concentrates, given China's current severe raw material supply issues, even a small contribution is better than none.
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