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Outlook 2021: Govt to push downstream mining industry as coal, metals rebound gently
World Bank data shows that COVID-19 expedited the flattening of coal prices and demand over the decade.
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The Pomalaa nickel smelter in Kolaka, Southeast Sulawesi, operated by state-owned metal miner PT Aneka Tambang (Antam). (Handout/Antam)
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ndonesia is poised to spend this year catching up on plans to develop a downstream mining industry as the country races against time to adapt to a long-term global shift in ore demand away from coal towards metals, while prices are expected to rebound gently.
Coal miners plan to continue studying the development of a downstream industry, while metal miners plan to resume their pandemic-delayed metal smelter projects. The latter particularly applies to nickel miners, who were the first to experience a government raw metal export ban.
State-owned mining holding company MIND ID hopes to close several deals early this year related to the formation of a flagship, nickel-rich electric vehicle (EV) battery industry in Indonesia.
“Nickel is expected to become an alternative to the coal industry that has all this time been a major contributor to the mining sector,” said Samuel Sekuritas investment analyst Dessy Lapagu on Nov. 24.
Read also: Explainer: Indonesia’s push for coal downstreaming against all odds
Globally, coal and metal prices are expected to start rebounding this year at a pace reflecting the world’s energy transition. That shift, according to the World Bank’s October 2020 commodity outlook report, has been hampered by the COVID-19 pandemic.
The transition involves a decline in coal-fired power plants and an increase in gas-fired power plants, renewable energy plants and electrification infrastructure such as EVs and power grids, all of which require electrification-related metals such as nickel, copper and aluminum.
