Nickel Gains After Indonesia Seizes Part of Giant Tsingshan Mine
(Bloomberg) -- Nickel rose after Indonesia seized part of a giant mine part-owned by top Chinese producer Tsingshan Holding Group Co., underlining risks to ore output in the world’s largest supplier.
The metal gained on the London Metal Exchange after a government task force took control on Thursday of about 148 hectares of the operation owned by PT Weda Bay Nickel — the world’s largest mine for the battery metal — over an alleged permit violation. France’s Eramet SA, one of the company’s shareholders, has said it saw no impact on operations at this stage.
Still, the seizure highlights ongoing challenges to reliable supply from Indonesia, which accounts for well over half of global nickel output. President Prabowo Subianto, who has outlined bold and costly plans for the nation, has also promised a crackdown on illegal mining, which may disrupt the flows of ore to local processors.
Smelters in Indonesia have been dealing with a tight ore market all of this year, due to high rainfall and low issuance of government mining quotas. At the same time, LME nickel prices have spent months range trading at low levels, held back by disappointing demand from the electric vehicle battery sector.
Nickel futures advanced 1.2% to $15,335 a ton on the LME by 2:32 p.m. in Singapore. Copper added 0.6% and aluminum rose 0.5%.
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