Company in focus: Antam faces a test as Indonesia shifts mining policy – by Erwida Maulia (Asia Nikkei – February 2, 2017)

http://asia.nikkei.com/

End to minerals export ban benefits state nickel producer

JAKARTA Indonesia’s surprise decision on the evening of Jan. 12, after the markets closed, to ease its mineral export ban sent ripples through Asia’s nickel industry. Shares of nickel producers in the region plummeted the day after the announcement on fears of a sudden supply surge.

Vale Indonesia, the country’s largest nickel producer and the local unit of Brazilian mining giant Vale, saw its share price plunge more than 15%, while Philippine miner Nickel Asia tumbled more than 10% at one point. Australia’s Western Areas fell nearly 20%, prompting one Australian media report to describe Jakarta’s decision as a “Black Friday blow.”

One company, though, stood out in the crowd. Indonesian state miner Aneka Tambang saw its shares jump 6%. That was because the government decided to allow exports of low-grade nickel ore — defined as ore containing less than 1.7% nickel — to resume, raising hopes that Antam, as the company is better known, will be able to reap benefits from the decision.

“We welcome [the new policy], notably as it allows the export of … mined low grade nickel ore which is yet to be used or processed domestically,” Antam President Tedy Badrujaman said in a press statement.

But the boost turned out to be short-lived. Antam’s share price failed to maintain momentum and dropped 6.9% on Jan. 24 to 805 rupiah — lower than in the days before the announcement — where it remained at the close on Jan. 27.

For the rest of this article, click here: http://asia.nikkei.com/magazine/20170202/Business/Antam-faces-test-as-Indonesia-shifts-mining-policy

Comments are closed.