The Market Monitor Minding the Nation's Business
After decades of lucrative profits from exporting ores of precious metals (iron, steel, nickel, gold, copper, etc,), the mining industry claims it is not yet ready for a total ban on ore exports, which Congress is now considering passing bills to discourage ore shipments in place of finished mineral products, where the country could earn more from.
In a statement, the Chamber of Mines of the Philippines (COMP) is urging lawmakers to extend the transition period for a proposed ban on raw mineral exports, warning that the industry needs more time to develop domestic processing capacity. So what has it done all these decades– simply earning?
COMP president/CEO Mike Toledo said mining firms face key challenges, including high power costs, limited operations, and the need for significant investments in processing plants, which can cost up to $1.6 billion.
The proposed legislation would prohibit raw mineral exports five years after its enactment, which Toledo said is insufficient time as he called for an extension of up to 10 years. He also recommended that the ban’s implementation remain flexible, allowing the President to adjust its timeline based on economic conditions.
The Philippines is one of the world’s top nickel producers, supplying most of its ore output to China and Indonesia. Toledo cautioned that restricting exports could disrupt the global supply chain and reduce demand for Philippine nickel, which is of lower grade compared to Indonesian deposits.
The mining industry, he added, remains committed to responsible practices through the Towards Sustainable Mining (TSM) initiative, which ensures compliance with environmental and social standards.
The Philippines, through the Department of Environment and Natural Resources (DENR), has tasked mining companies to align their social development programs with the United Nations’ Sustainable Development Goals (SDGs).
The Board of Investments has been promoting the Philippines as a hub for “green metals,” such as nickel and copper, which are essential for renewable energy, electric vehicles, and battery production.
Toledo claimed that substantial investments and infrastructure improvements are needed to support this vision.
“The Philippines has been identified as one of the most mineralized countries in the world in terms of resources, but the challenge is extracting them efficiently while ensuring sustainable development,” Toledo explained.
The Philippines is strengthening its nickel trade ties with India as part of its market diversification strategy, said Foreign Affairs Secretary Enrique Manalo during an official visit to India.
Manalo spoke before the Federation of Indian Chambers of Commerce and Industry (FICCI), where he highlighted the Philippines’ position as the world’s largest exporter of nickel ore, with exports valued at approximately $1.95 billion. But nearly 98% of its nickel exports are currently directed to China, with Japan buys the remaining 2%.
“We are quite interested to see India become a player in our nickel sector, not just for export diversification but crucially for processing and the development of a value chain,” Manalo said.
The Philippines is the world’s second-largest producer of nickel, accounting for 11% of global production in 2023. India, which currently imports about $707 million worth of raw nickel from countries like Russia, Norway, and Japan, could serve as an additional market for the Philippines’ nickel exports.
The FICCI showed eagerness to Manalo’s proposal, calling the supply realignment a “natural complementarity” between the two economies that remains largely untapped. India’s import base from the Philippines already includes products such as electrical machinery, semiconductors, and ores.
Manalo’s pitch comes as the Philippines looks to reduce its heavy reliance on China for its nickel exports and explore new opportunities for processing and value-added products.
The potential partnership with India could help bolster both nations’ positions in the global nickel market, particularly as demand for the metal rises in sectors like electric vehicle production. (Rose de la Cruz)