Aluminium retreated further to US$2,475 per ton in LME Monday (Jun 27) on concerns about global economy. The commodity has dropped from peak above US$3,000 per ton, affecting Cita Mineral (CITA), Indonesia’s largest bauxite miner. 

Nickel has dropped significantly in recent weeks to as low as US$22,100 per ton in the London Metal Exchange (LME). As energy price remains high, margins will be substantially squeezed, but this is still a good price for Indonesian producers. Besides, supply-demand fundamentals provide a long-term positive outlook.

WTI crude futures rose more than 1% to above US$111.5 per barrel on Tuesday, extending a 0.6% gain in the previous session, as persistent concerns about tight oil supply outweighed fears that aggressive monetary tightening could lead to a global recession and demand slowdown. 

State oil and gas firm Pertamina, one of the largest companies in Indonesia with total assets of US$78 billion, booked net profit of US$2.24 billion in 2021, surged 172% year on year, supported by revenues growth and cost efficiency. Some anticipate initial public offering (IPO) of two profitable subsidiaries in the upstream and geothermal.

Nickel miner Vale Indonesia (INCO), which holds one of the largest nickel concessions in the world, is currently under pressure from some politicians related to extension of its contract. Vale, where state-owned mining holding MIND ID is a substantial shareholder, embarks on two major nickel smelting projects worth more than US$2 billion. 

Nickel miner Vale Indonesia (INCO), which holds one of the largest nickel concessions in the world, is currently under pressure from some politicians related to extension of its contract. Vale, where state-owned mining holding MIND ID is a substantial shareholder, embarks on two major nickel smelting projects worth more than US$2 billion. 

PT Archi Indonesia Tbk (ARCI) and PT Merdeka Copper Gold Tbk (MDKA) reported strong sales performance in the first quarter of 2022, but gold miner J Resources Asia Pasifik (PSAB) was an outlier. 

Nickel has stabilized below US$30,000 per ton in London Metal Exchange (LME) in the past few weeks, with the last quoted price at US$28,575 per ton on Wednesday (June 1). This price is still good enough for Indonesian nickel miners despite higher input costs, particularly coal and fuel for nickel smelters. 

Shares of Bumi Resources (BUMI), the country’s largest coal producer, gained 5.45% to Rp58 on Tuesday (Maya 31) on broad market sentiment. At the last quoted price, BUMI was worth Rp7.5 trillion, nothing compared to Adaro Energy (ADRO), the second largest producer with market capitalization of Rp105 trillion.