Mining Stocks on New Regulations
Shares of Aneka Tambang (ANTM) gained 3.5% Friday morning as investors shared beliefs that this company will be benefited from new policy allowing export of low-grade nickel ores. Vale Indonesia (INCO), on the other hand, dropped 9.2%, as investors worried on negative impact of low-grade nickel export to nickel prices.
Coal Journal No. 02/2017: Output to Watch
United States of America started 2017 with recovery in coal production. US Energy Information Agency (EIA) estimated coal production of 13.8 million tons for the week ended January 7, 2017, an increase of 19.6% from the corresponding week last year.
New Mineral Regulations: On Freeport & Amman Mineral
Shares of Freeport McMoRan ended sharply lower by 3.8% in New York last night even when copper advanced 2.5% as market responded new regulations on minerals in Indonesia. Perception about supply side boosted copper because export of copper concentrates from Indonesia is affected.
New Regulation on Nickel & Bauxite: Implications?
Minister of energy and mineral resources Ignasius Jonan has issued Regulation No. 5/2017 allowing export of low-grade nickel (below 1.7% Ni) and bauxite ores. Nickel price fell 3% immediately on London Metal Exchange (LME) to respond the policy, which might benefit some in the short-term, but compromising mid and long-term prospect of domestic smelter investments.
Govt Regulation No. 1/2017 on Minerals
President Joko ‘Jokowi’ Widodo has finally signed Government Regulation No. 1/2017, which is the fourth amendment of Govt Reg No. 23/2014 about mineral and coal business operation. The new regulation basically extends export of minerals, including copper concentrates from Freeport and Newmont (now Amman Mineral) beyond January 11, 2017 with certain conditions.
Mother of All Problems: Interpretation of Law No. 4/2009 on Mineral & Coal
Article 93 of Law No. 4/2009 about Mineral and Coal clearly states that holder of mining business permit (IUP) and Special IUP (IUPK) is not allowed to transfer IUP and IUPK to others. We all know, however, thousands of IUP have been transferred to or acquired by others in the past eight years or so.
Palm Oil: Moratorium of New Plantations
The benchmark March 2017 contracts of crude palm oil (CPO) advanced RM52 to RM3134 per ton on the Bursa Malaysia Derivatives Wednesday (Jan 11). Falling output in Malaysia might have contributed to the gain. Going forward, plans from Indonesian government to start implementing moratorium for new plantations deserved attention.
Indika Group: Big Things to Watch
Indika Energy (INDY) has gained 560% since early 2016. Still, the company is valued less than half of its equity as at Sept 30, 2016. Going forward, there are some big things to watch from this company and its subsidiaries.
Shenhua’s Grip in Indonesia (3)
Shareholders meeting of China Shenhua Energy Co Ltd, one of the largest integrated energy companies in the world, on December 23, 2016 approved the provision of guarantee to PT Shenhua Guohua Lion Power Indonesia (Lion Power), paving the way for smooth construction of 2×300 MW mine-mouth power plant in Muara Enim, South Sumatra province.
Palm Oil: Output to Watch
Malaysian Palm Oil Board is scheduled to release December data for CPO production and stock Tuesday (Jan 10). Our data from some Malaysian planters suggested lower month-on-month output, but mixed on year-on-year performance.