Indonesian bauxite producer seeks export ban relaxation

A bauxite miner in Indonesia will approach the government with the request to allow export of the aluminium ore and grant a yearly quota of 40 million metric tons, reported industry sources. The move would ease the country's current ban on all mineral ore exports imposed two years back.

Permitting offshore sales of mineral ores including bauxite “would have a massive domino effect,” said Erry Sofyan, chairman of the Association of Indonesia Bauxite and Iron Ore Producers. “It would create 40,000 jobs and revive the shipping industry in Batam,” he said, referring to an island near Singapore. Indonesia shipped 55 million tons of bauxite to China in 2013, he noted.

Indonesian government is set to take decision on the export policy this week. It is likely to defer the ban by three to five years from January 2017.

Luhut Panjaitan, the acting energy and mineral resources minister, said last week Wednesday the ministry would probably keep the moratorium on nickel ore and bauxite exports for the time being. A proposal to ease the ban had spurred opposition from the smelter owners a week earlier.

Indonesia “has attracted investments of about $5 billion, including for stainless steel, so why do we need to export if we can process domestically?” Panjaitan argued.

The southwest Asian country had been the top supplier of nickel and bauxite ore till it imposed ban on the raw mineral ore export to rein on the outflow of natural resources and to develop a domestic metal processing industry.

Well Harvest, a joint venture between the Jakarta-based Harita Group, China Hongqiao Group and others, plans to export 500,000 tons of alumina this year. The company aims at doubling capacity to one million tons next year, said industry sources. PT Aneka Tambang also has a chemical-grade alumina plant in Tayan in West Kalimantan.

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