Plan to limit the grade of nickel ore trading, and multiple measures in Indonesia to promote the development of new energy industry

Indonesia is the world's largest producer of nickel, which is an important component of long-term electric vehicle batteries. The country is carrying out dozens of projects, mainly invested by Chinese companies, to process nickel ore into raw materials and use them for battery production in other places. On March 6th, APNI Secretary General Meidy Katrin Lengkey stated at the 6th anniversary celebration that several things need to be done to establish equal management and business in the nickel mining and management industry.

In Indonesia, pyrometallurgy plants dominate nickel smelting, usually processing 1.8% of high-grade nickel ore (sapropel) as raw materials for stainless steel. Indonesia's nickel ore reserves are mostly low-grade (limonite), which can be used as raw materials for electric vehicle batteries.

In order to maintain the availability of reserves and optimize limonite, it is necessary to limit the nickel ore grade allowed to trade to a maximum of 1.6%. Meidy stated that if the grade of nickel ore traded exceeds 1.8%, sanctions must be imposed on suppliers and buyers.

Considering the supply capacity of the mine, APNI suggests that the government force smelters to provide a balance sheet of raw material demand (nickel ore) to the Ministry of Energy and Mineral Resources for discussion with miners. Transporting nickel ore by road or truck has caused losses to the country, as the nickel ore enters the smelter directly without paying any e-PNBP fees or including origin documents.

The Ministry of Energy and Mineral Resources and the HPM Working Group must also immediately prepare a benchmark price (HPM) for limonite (low-grade) minerals in order to increase the value of minerals.

In addition, the Indonesian government has launched a "stronger than neighboring countries" electric vehicle subsidy project to attract more international electric vehicle manufacturers to invest in Indonesia.

Luhut Binsar Pandjaitan, Indonesian Minister of Ocean and Investment Coordination, said that from March 20, consumers who buy electric motorcycle can get subsidies of up to 7 million rupiah (about 3167 yuan). At the same time, the government also plans to provide subsidies to 35000 electric vehicles and 138 electric buses. The specific amount will vary according to different models.

To receive this subsidy, car manufacturers need to produce electric vehicles locally in Indonesia, and 40% of the components need to be produced or purchased locally. Indonesian Minister of Industry Agus Gumiwang Kartasasmita stated that currently only China's Air EV and South Korean Hyundai (Ioniq 5) are eligible. In terms of electric motorcycle, only three local manufacturers can meet the subsidy requirements.

The country also attracts investment transactions from global electric vehicle manufacturers, including Tesla and BYD, to compete with Thailand and other regional countries.