Bloomberg reported that nickel ore and bauxite shipments from Indonesia, the top supplier to China, may plunge 75% this year as a ban on metal ore sales comes into force in May, two years earlier than scheduled.
Mr Syahrir Abubakar executive director of the Indonesia Mining Association said that the ban, originally set for 2014 was brought forward as exports surged in the past 3 years. The country shipped 33 million tonnes of nickel ore and 40 million tonnes of bauxite in 2011. China took about 80% of its bauxite imports and 53% of its nickel ore purchases from the Southeast Asian nation last year.
Mr Abubakar said that miners with Contracts of Work, including Freeport McMoRan Copper & Gold Inc and Newmont Mining Corporation will be allowed to export ores until 2014. The ban will affect mostly small miners as the country’s major nickel producers PT Vale Indonesia and PT Aneka Tambang have already started local processing.
Mr Nicholas Snowdon an analyst at Barclays Capital said that “The critical trade market impact would be that Indonesia exports more refined metal over primary ore. Chinese nickel pig iron makers will find it difficult to fully replace lost Indonesian supplies as ore from the Philippines is used more for its iron content.
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