Nickel Asia: Tuesday drop caused by confusion over Indonesian report
MANILA, Philippines - Nickel Asia said Tuesday's 6 percent plunge was the result of confusion over a report on Indonesian metal exports.
On Friday, Reuters reported Indonesia had resumed exports of some metal ore concentrates for the first time in six months.
The ban, imposed in January, was meant to encourage the building of processing plants in Indonesia. It helped drive world nickel prices higher, boosting Nickel Asia's revenue.
Nickel Asia chief financial officer Emmanuel Samson says some investors called and he had to explain to them that the lifting of the ban was partial and did not cover nickel ore, which is what Nickel Asia exports.
"The article created some kind of confusion," he said in a phone interview.
He stressed what was allowed was the shipment of metal concentrates, which is different from ore.
Nickel Asia president Gerry Brimo also said the ban on ore, including nickel, has not been lifted by Indonesia.
"They have not lifted the ban on ore. They may have lifted the ban on concentrates," he said in a separate phone interview.
Both noted the price of nickel didn't move much.
Nickel Asia more than doubled its sales in the first half, thanks in part to the ore deficit created by the Indonesia ore export ban.
A separate Reuters report on Thursday said some China buyers are looking to smuggle ore out of Indonesia, which would hurt Philippine exporters, probably including Nickel Asia.
Samson said he isn't worried about the impact of any smuggling because demand in China is so strong that smugglers wouldn't be able to keep up.
He said any amount that can be smuggled out without being caught won't affect prices.
"How much can they really smuggle out?," Samson said. "We're talking about 400,000 tons of contained nickel. That is a lot of smuggling that they will have to do to cover that. I'm sure that kind of operation would catch the attention of indonesian authorities."