Indonesia to have seven new smelters in 2022

• A record-high seven metal smelters are scheduled to come online this year as companies catch up on project deadlines amid the ongoing economic recovery.
• Energy and Mineral Resources Ministry data from 20 Jan 22 showed that 2022 would see the highest one-year increase in new smelter units since at least 2015, a year after Indonesia introduced a regulation to ban all raw metal exports.
• The 7 smelters comprise two nickel, one lead, one zinc, one alumina and two iron smelters, some of which were carried over from last year. These new facilities would bring the total number of operational smelters in Indonesia to 28 by end-2022.
• Smelter construction is part of the government’s larger scheme to foster downstreaming in extractive industries to grow the economy. To achieve this, regulators have permanently banned exports of nickel ore and plans to enact similar bans on bauxite and raw copper starting 23 Jun 22.
• Indonesia, formerly the world’s top nickel ore exporter, shook global markets with its export ban. The European Union has brought Indonesia to the World Trade Organization to challenge the ban.
• Indonesia is expected to have 53 smelters in total by 2024 to create a sizeable enough market to absorb the excess domestic metal ore supply. Recently, President Joko “Jokowi” Widodo said he wanted to speed up the bauxite export ban to this year.
• Processing and Smelting Companies Association (AP3I) chairman Prihadi Santoso urged the government to review import duties and fiscal incentives to make domestically refined metals competitive with imported variants. This was necessary to incentivize downstreaming.
• Indonesia only added two new smelters of the four smelters targeted to come online last year. Only one smelter, owned by PT Cahaya Modern Metal Industry in Banten fulfilled the construction target in 2021.
• Meanwhile, the other smelter, owned by PT Halmahera Persada Lygend in North Maluku, finished a year earlier than expected.
• The three smelter projects that missed the target are owned by PT Kapuas Prima Citra in Central Kalimantan, PT Aneka Tambang (Antam) in North Maluku and PT Smelter Nikel Indonesia with construction progress reaching 99.8%, 99.7% and 98.7% as of last week, respectively.
• Among the three upcoming smelters, the largest one by output is the nickel smelter of publicly listed diversified miner Antam. The smelter, last valued at USD1.6bn, will produce 64,655 tons of ferronickel each year.
• Four other smelters targeted for completion in 2022 are owned by PT Kobar Lamandau Mineral, PT Well Harvest Winning, PT Alchemist Metal Industry and PT Sebuku Iron Lateritic Ores. The smelters will produce zinc ingot, smelter-grade alumina, pig iron and sponge ferroalloy, respectively.

External Link : https://www.thejakartapost.com/business/2022/01/24/indonesia-to-have-seven-new-smelters-this-year.html