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Country closes 23 mines and suspends five more, following environmental audit
Andrew Topf | |
Rodrigo Duterte, president of Philippines. (Photo: Presidential Communications - Government of the Philippines)
The price of nickel rose sharply last week as traders placed bets on supply pressures reverberating from a decision by the Philippines to close almost two dozen mines. On the London Metal Exchange, nickel, used to make stainless steel, reached $10,500 a tonne Thursday after President Rodrigo Duterte's government ordered the closure of 23 mines – mostly nickel. The order includes mines run by Hinatuan Mining Corp, a unit of top Philippine nickel ore producer Nickel Asia Corp, and BenguetCorp Nickel Mines Inc. "I visited the mines and I made my own judgment based on my own observations": Environment and Natural Resources Secretary Regina Lopez Five more mines will be suspended, including the country's largest gold mine, operated by Australia's Oceanagold Corp.(TSC,ASX:OGC) The closure decision came following the results of a government audit that investigated the mines' role in degrading the environment. The audit of 41 mines, started last summer, was led by Environment and Natural Resources Secretary Regina Lopez, an environmentalist critic of the mining industry. "I visited the mines and I made my own judgment based on my own observations," Lopez said in a televised briefing, noting that 15 of the mines ordered closed are located in watersheds. It is estimated that the mine closures affect roughly half of the Philippines' annual mining output, or around 8 percent of world supply. The country is one of the largest sources of unprocessed nickel ore, and a major supplier to China, which uses it to make pig iron, a cheaper alternative to refined nickel. Even before the audit, 11 mines were shut down for failing to comply to stricter environmental rules. Mainly used as an anti-corrosive in steel alloys, nickel rallied in 2016 on the back of a clampdown on mines in the Philippines which took over as the main supplier to China following an ore export ban in Indonesia in place since 2014. The market was rocked earlier this month when Indonesia abruptly announced a partial lifting of the ban allowing exports of up to 5.2 million tonnes of nickel ore in 2017. However Capital Economics, a London-based independent research house, recently said nickel prices should rise 20% this year based on tightening market conditions including constrained supply from the Philippines. An analyst quoted by the Financial Times said that last week's news from the Philippines would likely offset the increased nickel supply from Indonesia, thus preventing any price slippage. “We regard any supply-side shift of more than 5 per cent as sufficient to alter the short-term price,” the FT quoted Tom Price, an analyst at Morgan Stanley. “So this potential 8 per cent event is significant.” |
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来自： J_ZHANG_FT > 《矿业情报》
