Effects of Indonesia Ore Export Ban On China Nickel Alloy Market

The harsh nickel-iron ore exporting ban by Indonesia

Back to January 2014, in the purpose of promoting its domenstic nickel-iron ore processing industry, the Indonesian government issued a ban on all ore exports, including iron and nickel ore. This historical harsh ban was reaffirmed by the authority in early 2015.

According to London Metal Exchange(LME), Indonesian ore is the raw material for up to 32% of global production of nickel, which is used to make stanless steels and nickel based alloys. The critical move by Indonesian government had drastically changed the outlook for China's nickel market. Take the nickel alloy 600(Inconel 600) and nickel alloy 625(Inconel 625) flanges for example, the unit FOB Shanghai price rose almost 60%. The Hastelloy C-276 seamless pipes and Monel 400 bolts and nuts rosed 55%.

Processing of nickel ores transferred to Indonesia

As an eminent manufacturer and supplier of special metal piping components, almost one third of our flanges, valves, fittings and fasteners are made from nickel based alloys. The negative effect of the ban is obvious. In order to sustain competitiveness, Hebei Metals Industrial Limited has been working closely with our Indonesian partners. We invested two brand new electroslag smelters in a Jakarta-based factory to help local clients to process the nickel-iron ores to ingots or billets which are more value-added. The ingots or billets will be later shipped to China to take further process such as forging, piercing, hot rolling, cold draw and mid-frequency extruding, ect. The ultimate product form of these nickel based alloys can be strips/plates/sheets, flanges, butt welding pipe fittings, branch outlets, valve parts and seamless pipes, etc.