Indonesia to ban export of nickel ore by January

Indonesia to ban export of nickel ore by January
Waste from a nickel plant in Papua New Guinea is seen in the waters of the adjacent Basamuk Bay, in Indonesia’s Papua New Guinea. (Reuters)
Updated 02 September 2019

Indonesia to ban export of nickel ore by January

Indonesia to ban export of nickel ore by January
  • Exporters to stop shipments from that date regardless of standing contracts

JAKARTA: Indonesia said on Monday it will stop nickel ore exports from Jan. 1, 2020, two years earlier than initially flagged as it speeds up efforts to process more of its resources at home.

Bambang Gatot Ariyono, the Mining Ministry’s director general for coal and minerals, said the ban will be applicable to all grades of nickel ore and ordered exporters to stop shipments from that date regardless of standing contracts.

“That is why we are announcing now so they have four months of transition time,” Ariyono told reporters.

Speculation about an expedited ban and Monday’s announcement has boosted nickel prices. The three-month nickel contract on the London Metal Exchange gained 3 percent to $18,470 a ton on Monday, its highest in nearly five years, adding to Friday’s 9 percent gain.

Goldman Sachs said in a note on Sunday it expects London nickel prices to reach $20,000 per ton in three months due to the ban.

Ariyono said the timetable was expedited because of the limited pool of mineable nickel resources in the country.

“The national proven reserve for nickel is only 698 million tons, which can only supply smelting facilities for 7.3 years,” he told reporters, adding that Indonesia currently has 11 working smelters with input capacity of 24 million tons of ore. It has 25 more smelting facilities in the pipeline.

The government had initially said it would ban nickel ore exports from January 2022, according to a rule released in 2017.

It is retaining that later date for the end of exports of bauxite and copper concentrates.

Indonesian President Joko Widodo in Parliament last month vowed to push for adding value to the country’s natural resources exports.

Philippine nickel miners said they are likely to boost output of nickel ore next year to fill up supply gap left by Indonesia.


France wants end to US-Europe trade spat

France wants end to US-Europe trade spat
Updated 17 January 2021

France wants end to US-Europe trade spat

France wants end to US-Europe trade spat
  • All eyes on President-elect Biden to resolve disputes between partners

PARIS: The EU and the incoming administration of US President-elect Joe Biden should suspend a trade dispute to give themselves time to find common ground, France’s foreign minister said in remarks published on Sunday.

“The issue that’s poisoning everyone is that of the price escalation and taxes on steel, digital technology and Airbus,” Jean-Yves Le Drian told Le Journal du Dimanche in an interview.

He said he hoped the sides could find a way to settle the dispute. “It may take time, but in the meantime, we can always order a moratorium,” he added.

At the end of December the US moved to boost tariffs on French and German aircraft parts in the Boeing-Airbus subsidy dispute, but the bloc decided to hold off on retaliation for now.

The EU is planning to present a World Trade Organization (WTO) reform proposal in February and is willing to consider reforms to restrain the judicial authority of the WTO’s dispute-settlement body.

The US has for years complained that the WTO Appellate Body makes unjustified new trade rules in its decisions and has blocked the appointment of new judges to stop this, rendering the body inoperable.

The Trump administration, which leaves office on Wednesday, had threatened to impose tariffs on French cosmetics, handbags and other goods in retaliation for France’s digital services tax, which it said discriminated against US tech firms.

Overturning decades of free trade consensus was a central part of Trump’s “America First” agenda. In 2018, declaring that “trade wars are good, and easy to win,” he shocked allies by imposing tariffs on imported steel and aluminum from most of the world.

While Trump later dropped tariffs against Australia, Japan, Brazil and South Korea in return for concessions, he kept them in place against more than $7 billion worth of EU metal. The bloc retaliated with tariffs on more than $3 billion worth of US goods, from orange juice and blue jeans to Harley Davidson bikes, and took its case to the WTO.

While Biden promises to be more predictable than Trump, he is not expected to lift the steel tariffs immediately. Even if he wants to, he could run into reluctance from producers in “rust belt” states such as Michigan and Pennsylvania that secured his election win.

Hosuk Lee-Makiyama, director of trade think tank ECIPE, said the US was unlikely to award Europe a “free pass,” noting that countries that had offered concessions to have their tariffs lifted could complain if Europe won better treatment.

Resolving future trade disputes could become easier, if Biden reverses Trump policy that paralyzed the WTO by blocking the appointment of judges to its appellate body.