The London Metal Exchange nickel price dropped 4% in intraday trading on Thursday morning
following news reports that Indonesia will allow nickel ore to be exported from the country under certain conditions.
The move is likely to disappoint many of those who had invested in the domestic nickel smelting industry, under the impression the mineral export ban – introduced in 2014 – would continue and provide an excellent opportunity to tap into Indonesia’s vast amount of resources and growing demand for the metal as a finished product worldwide.
What is curious is that the government has decided to reverse its position on the ban just three years after it was implemented, considering that the actual purpose of the export ban back in 2014 was, among many things, to encourage investment in domestic processing plants.
“The government’s current fiscal position is so dire that it really needs to generate more revenue...