The country’s nickel output is projected to grow by up to 62 percent over the next five years as local miners attempt to get a bigger slice of China’s growing market for this metal.
An S&P Global Market Intelligence analysis pointed out that nickel output in the Philippines would grow to 550,000 tons in 2025 from 340,000 tons in 2020—this as China becomes more dependent on the Philippines for its nickel laterite ore needs given the ongoing nickel ore export ban in Indonesia.
About 90 percent of the country’s nickel ore exports are shipped to the East Asian giant, where construction remains robust despite economic disturbances brought by the coronavirus pandemic.
S&P noted that three suspended nickel mines were restarted last year “as the government turned to the mining sector to help mitigate COVID-19’s economic impacts.”
Despite shipments and operations gridlock, the metallic mining industry posted a 1.13-percent growth last year, according to the Mines and Geoscience Bureau.
Nickel, in particular, accounted for 52 percent of the country’s ore sales at P64.48 billion. MGB said it was nickel that “steered the local mining industry to this upswing” as it continued to cater to China’s growing demand for stainless steel.
However, S&P said the current legislative framework for mining continues to constrict the sector’s growth.
“We believe that existing environmental restrictions on Philippine mining will limit the scope for further mine restarts or additional production from new mining projects in the medium-term,” it said.
“This will prevent the Philippines from meeting China’s nickel ore requirements in Indonesia’s absence, driving Chinese primary output down from an estimated 715,000 tons in 2020 to 490,000 tons in 2025,” it added.
Gerard Brimo, president of the Chamber of Mines of the Philippines, appealed to the government late last year to lift the suspension on new mining deals to spur economic growth. INQ