Nickel ore output drops 16 pct in 3Q as Duterte's clampdown bites

Manolo Serapio Jr., Reuters

Posted at Dec 05 2016 03:16 PM

MANILA - The Philippines' output of nickel ore fell 16 percent in the third quarter from a year earlier, government data showed on Monday, after the world's top supplier of the metal suspended some mines in a clampdown on environmental violations.

The Southeast Asian nation has already stopped work at 10 of its 41 mines in a campaign, backed by President Rodrigo Duterte, against what the government says is irresponsible mining. A group of a further 20 more faces possible suspension.

Output of nickel ore for direct shipping fell to 9.34 million tons in July-September from 11.09 million tons in the same period last year, data from the Mines and Geosciences Bureau showed.

Environment and Natural Resources Secretary Regina Lopez told Reuters on Friday that there will "definitely" be more mine suspensions when the ruling on the 20 facing suspension is released, possibly within the week.

The Philippines is the biggest supplier of nickel ore to China, where the metal is used to make stainless steel. Eight of the 10 suspended mines are nickel producers, and along with 14 of the 20 facing suspension, they accounted for more than half of the Philippines' nickel ore output last year.

Production dropped to 19.8 million tons in the nine months to September from 25.97 million tons a year ago, according to the data.

Weak prices also contributed to the drop in output during the nine-month period, the mining bureau said. By value, nickel direct shipping ore dropped 44 percent in January-September.