METI Seeks Modification of Indonesia Raw Ore Export Ban

Ministry of Economy, Trade and Industry’s director general of manufacturing industries bureau, Takayuki Ueda visited Indonesia on Wednesday to seek reconsideration of immediate export ban of nickel and copper raw ore. Indonesian government tries to encourage the exporters to add value on the raw materials through the export ban.

The export ban impacts on Japanese ferronickel production when Indonesian nickel ore represents 50% of Japanese import. Mr. Ueda plans talk with Indonesian in Economic Coordination Minister Office and Ministry of Energy and Mineral Resources. Mr. Ueda warns the export ban could violate WTO agreement and the immediate ban should harm existing supply chain.

Indonesia launched new mining rule in 2009. The government decided the detail in February to ban raw ore export, which could activate in May 6. Japanese industry could suffer from the immediate export ban when they cannot find alternative source while the export ban could take effect in 2014.

Stainless makers are also wary about the export ban when the ban could result in worldwide nickel shortage and higher nickel cost. Stainless users could shift to less nickel stainless grade and the move could result in lower nickel demand in longer term.