Indonesia considers easing bauxite export ban

Indonesia's Ministry of Energy and Mineral Resources is considering a plan to resume bauxite ore export, following a call by the House of Representatives to lift the ban as part of an effort to develop the economy in mining areas.

Maman Abdurrahman, Vice Chairman of the House of Representatives Committee VII for Energy and Mineral Resources, said the lower house proposed the ministry switch the ban to restricting export quotas.

Indonesia has banned bauxite and copper exports since June 2023, after applying a similar policy to nickel mining companies in early 2020.

As for bauxite ore, the Indonesian Government wants more commodities to be processed in the country such as alumina, the core raw material for aluminum production. Local mining companies have opposed the ban because they fear it will force them to cut production and lay off thousands of workers.

Chairman of the Indonesian Energy and Mining Forum Singgih Widagdo said the Government needs to closely monitor the establishment of bauxite smelters in the country before lifting the export ban, as Indonesia does not have significant influence on global bauxite prices.

He held that the Government must consider industrial development of bauxite derivatives.

Mining companies also point to the asymmetry between national bauxite production and input capacity of current smelters. At current production levels, the export ban will result in about 17 million tonnes of unprocessed bauxite.

The ministry estimated that domestic bauxite production reached 31 million tonnes in 2023, far exceeding the country's overall ore smelting capacity, which is only at 14 million tonnes.