SHANGHAI, Nov 29 – Foreign media reported on November 28 that Indonesia is considering implementing a copper concentrate export ban from 2023. But market participants expect this to have limited impact on China, the world's top copper concentrate importer.
Indonesia's copper concentrate is mainly exported to China and other Asian countries, and a small volume is exported to Japan. However, from January to October this year, Indonesian copper concentrate only accounted for 2.1% of China’s total imports of 19.2 million mt. In 2020, Indonesian copper concentrate accounted for 1.7% of China’s total imports of 21.8 million mt. In 2019, it accounted for 1.3% of China’s total imports of 22 million mt.
Market participants said that the supply of copper concentrate is expected to be sufficient in the next two to three years, which will significantly reduce the impact of the potential ban on Indonesian copper exports. The rise in the copper prices in the past two years has prompted some idle or old copper mines to resume or expand production.
Freeport-McMoRan, the operator of Indonesia's largest copper mine Grasberg, has built a copper smelter in East Java. The designed capacity is 2 million mt/year of copper concentrate, and the smelter is planned to be completed in December 2023. In addition, a new smelter in Indonesia with a processing capacity of approximately 1.7 million mt/year is expected to be built in Indonesia. The smelter is expected to be completed in 2024, but the schedule may be affected by the COVID-19 pandemic. After the smelter is put into operation, the consumption of copper concentrate in Indonesia will exceed 3.7 million mt per year.
From 2022, the Grasberg copper mine and two to three small copper mines in Indonesia are expected to produce 3.6-3.8 million mt of copper concentrate per year. This means that Indonesia will be able to process all the domestic copper concentrates, and there will be no need to export copper concentrates after 2024.
