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The world’s largest copper miner, Chile’s Codelco, dodged a bullet this past week when management got an early labor deal signed with workers at the Chuquicamata mega-mine — heading off any potential strike action.
But the news wasn’t quite as good this week in another major copper nation - Indonesia.
Politicians in the country told a press gathering that they’re still seeking a solution to one of the biggest issues in the mining space here: a looming ban on unprocessed mineral exports. Which could see copper supply from the nation choked off over the coming weeks.
The ban itself dates back to January 2014 — when regulators passed a law requiring mined ore to be upgraded in Indonesia. Precluding the export of mineral concentrates to foreign smelters, which was common practice at the time.
Regulators then backed off, amending the law to allow concentrate exports until January 12, 2017. Giving time for miners to build local smelters to process ore.
That deadline is now just three weeks away. And miners like Indonesia’s biggest copper producer Freeport-McMoRan are reportedly looking for more time — but there’s no guarantee they’re going to get it.
That’s because Indonesia’s government still hasn’t made any progress in changing the law. With officials
from a parliamentary commission overseeing mining saying they haven’t received any updated legislation on the export ban — despite reports earlier this year that revised rules would be ready by September.
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Without such legal changes, officials said they are powerless to give miners a reprieve from the looming deadline. Setting up for a tense few coming weeks, while copper producers wait to see if anything is going to give.
If a solution isn’t found, January 12 could see an abrupt end to all copper exports from Indonesia (also affecting by-product gold production). Mining ministry officials said they are in talks with other branches of government to reach a solution — watch to see if any last-minute reprieves emerge over the next three weeks.
Here’s to a nail-biter,
By Dave Forest
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Dave is Managing Geologist of the Pierce Points Daily E-Letter.