IMA-Daily Update Page 1

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Adaro Energy (ADRO) coal production and sales declined in the first half of 2020 Produksi dan penjualan batubara Adaro Energy (ADRO) merosot di paruh pertama 2020 Despite Covid-19, Freeport Indonesia Believes Production Target Achieved Meski Covid-19, Freeport Indonesia Yakin Target Produksi Tercapai Jokowi reaffirms Indonesia’s 'massive downstreaming’ of natural resources After Dropping 50%, United Tractors (UNTR) Heavy Equipment Sales Rise in 2021 Usai anjlok 50%, penjualan alat berat United Tractors (UNTR) bangkit di 2021 Developing underground mining, Freeport invests US$ 1.3 billion Kembangkan Tambang Bawah Tanah, Freeport Investasi US$1,3 Miliar Facts on Nickel Downstreaming Encouraged by Jokowi Fakta Hilirisasi Nikel yang Digalakkan Jokowi Welcoming the supervisory task force, APNI hopes that the HPM regulation can be realized Sambut baik satgas pengawas, APNI berharap aturan HPM bisa terealisasi Next year Freeport aims to increase production Tahun Depan Freeport Bidik Kenaikan Produksi The Supervisory Team for Nickel Trade formed, AP3I is still hoping to adjust the price formula Tim pengawas tata niaga Nikel dibentuk, AP3I masih berharap penyesuaian formula harga Lonely Sentiment Bro! Coal Can Only Rise Slightly Sepi Sentimen Bro! Batu Bara Hanya Mampu Naik Tipis

Kontan Bisnis The Jakarta Post Kontan Bisnis CNN Indonesia Kontan Republika Kontan CNBC Indonesia

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DMCI Mining reports increased shipments BHP seeking thermal coal exit, profit slips amid virus hit Vietnam coal imports jump 50 pct Iron ore edges higher on China demand optimism, stainless steel shines Lynas posts 2020 loss, raises funds for plant in Australia Super Pit future secured by major extension Thermal coal, coking coal imports dip 31% to 37 million tonnes in April to July

Manila Bulletin WA Today VN Express Reuters Mining.com Australian Mining Business Today

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IMA-Daily Update Page 3

Adaro Energy (ADRO) coal production and sales declined in

the first half of 2020 Reporter: Ridwan Nanda Mulyana | Editor:

Anna Suci Perwitasari

PT ADARO Energy Tbk (ADRO) recorded a decline in operating performance during the first half of this year. ADRO coal production in the first semester of 2020 was recorded at 27.29 million tons, down 4% compared to the same period last year.

On a quarterly basis, in the second quarter of 2020 ADRO coal production was 12.88 million tons. This amount is 11 percent lower than the realization of production during the first quarter of 14.41 million tons. Also 13% smaller than the realization of ADRO's coal production in the same period in 2019 which reached 14.73 million tons.

In the report submitted to the Indonesia Stock Exchange (IDX), the decline did not only occur from the production side. ADRO's coal sales volume in the first half of 2020 also slumped to 27.13 million tonnes, down 6% year on year (yoy), which in the first half of last year reached 28.77 million tonnes.

When compared on a quarterly basis, ADRO's coal sales in the second quarter fell 11% compared to sales in the first quarter of 2020 which amounted to 14.39 million tons. Meanwhile, compared to sales in the April-June 2019 period, ADRO coal sales have decreased by 17%.

Not only from the coal production line and sales, ADRO's overburden stripping has decreased, to 103.01 million bank cubic meters (Mbcm) in the first half of 2020, down 19% yoy. This is in line with the guidelines for lowering the strip ratio this year.

Produksi dan penjualan batubara Adaro Energy (ADRO) merosot di paruh pertama 2020

Reporter: Ridwan Nanda Mulyana | Editor: Anna Suci Perwitasari

PT ADARO Energy Tbk (ADRO) mencatatkan penurunan kinerja operasional sepanjang paruh pertama tahun ini. Produksi batubara ADRO pada periode semester I-2020 tercatat sebesar 27,29 juta ton atau turun 4% di-banding periode yang sama pada tahun lalu.

Secara kuartalan, pada periode kuartal II-2020 produksi batubara ADRO 12,88 juta ton. Jumlah ini lebih rendah 11% dibanding realisasi produksi selama kuartal pertama yang sebesar 14,41 juta ton. Juga lebih mini 13% ketimbang realisasi produksi batubara ADRO pada periode yang sama tahun 2019 yang mencapai 14,73 juta ton.

Dalam laporan yang disampaikan kepada Bursa Efek Indonesia (BEI), penurunan tak hanya terjadi dari sisi produksi. Volume penjualan batubara ADRO di semester I -2020 juga merosot menjadi 27,13 juta ton atau turun 6% secara year on year (yoy), yang pada paruh pertama tahun lalu mencapai 28,77 juta ton.

Jika dibandingkan secara kuartal, penjualan batubara ADRO di kuartal kedua turun 11% ketimbang penjualan pada kuartal I-2020 yang sebesar 14,39 juta ton. Sedangkan di-banding penjualan pada periode April-Juni 2019, penjualan batubara ADRO telah turun 17%

Tak hanya dari lini produksi dan penjualan batubara, pengupasan lapisan penutup oleh ADRO mengalami penurunan, menjadi 103,01 million bank cubic meter (Mbcm) pada semester I-2020 atau turun 19% secara yoy. Hal tersebut sejalan dengan panduan untuk menurunkan nisbah kupas tahun ini.

IMA-Daily Update Page 4

ADRO management, through Corporate Secretary & Investor Realtions Division Head Mahardika Putranto, said that the Covid-19 pandemic had an impact on the decline in operational performance.

"A strong starting point for the company in the first quarter of 2020 was followed by weakening conditions in the second quarter due to the long rainy season in the area of operation and decreased demand due to the weakening global economy as well as a decline in industrial electricity demand due to the lockdown due to Covid-19," he said, as quoted by Kontan.co.id, Monday (17/8).

Lockdown due to Covid-19, impacted many ADRO customers along with weakening demand for electricity in customer countries. "Apart from the negative impact of Covid-19, the uncertainty of import policies in several countries has increasingly put pressure on the coal market which is already un-balanced," he said.

Meanwhile, the Southeast Asian market stil l dominates ADRO coal sales in Semester I-2020 with a share of around 47%, with the largest markets in Indonesia and Malaysia. After that, the East Asian market supported ADRO's coal sales with a share of 24%. Followed by India and China with equal portions, respectively 14%, and 1% to other markets.

Given the difficult market conditions, ADRO has also revised several components of the 2020 guidance, to be as follows:

• Coal production: 52 million tonnes - 54 million tonnes

• Operational EBITDA: US$ 600 million - US$ 800 million

• Capex: US$ 200 million - US$ 250 million

"The new target for coal production fell by about 10% compared to 2019 on a YoY basis, which was mainly driven by a decrease in thermal coal production," concluded Mahardika.

Manajemen ADRO, melalui Corporate Secretary & Investor Realtions Division Head Mahardika Putranto mengatakan, pandemi Covid-19 ikut berdampak terhadap penu-runan kinerja operasional tersebut.

"Titik awal yang kuat bagi perusahaan pada kuartal pertama 2020 diikuti dengan kondisi yang melemah pada kuartal kedua akibat musim hujan yang panjang di wilayah operasi dan penurunan permintaan karena melemah-nya ekonomi global serta penurunan permintaan listrik industri karena lockdown akibat Covid-19," kata dia, seperti yang dikutip Kontan.co.id, Senin (17/8).

Lockdown karena Covid-19, berdampak terhadap banyak pelanggan ADRO seiring dengan permintaan listrik di negara-negara pelanggan yang melemah. "Selain dampak negatif Covid-19, ketidakpastian kebijakan impor di beberapa negara semakin memberi-kan tekanan terhadap pasar batubara yang memang sudah tidak seimbang," sebutnya.

Adapun, pasar Asia Tenggara masih men-dominasi penjualan batubara ADRO di Semester I-2020 dengan porsi sekitar 47%, dengan pasar terbesar di Indonesia dan Malaysia. Setelah itu, pasar Asia Timur menopang penjualan batubara ADRO dengan porsi 24%. Disusul oleh India dan China dengan porsi berimbang masing-masing 14%, dan 1% ke pasar lainnya.

Mengingat kondisi pasar yang sulit, ADRO pun melakukan revisi terhadap beberapa komponen panduan di tahun 2020, menjadi sebagai berikut:

Produksi batubara: 52 juta ton - 54 juta ton

EBITDA operasional: US$ 600 juta - US$ 800 juta

Belanja Modal: US$ 200 juta - US$ 250 juta

"Target baru untuk produksi batubara turun sekitar 10% dibandingkan tahun 2019 secara YoY, yang terutama didorong oleh penurunan produksi batubara termal," pungkas Mahardika.

IMA-Daily Update Page 5

Despite Covid-19, Freeport Indonesia Believes Production

Target Achieved Denis Riantiza Meilanova

PT FREEPORT Indonesia is optimistic that

the company's gold and copper production will be able to achieve the planned target despite the Covid-19 pandemic.

PT Freeport Indonesia (PTFI) President Director Tony Wenas said that the Covid-19 pandemic had an impact on the company. However, he ensured that the activities to increase the production of underground mining at the Grasberg Block Cave and Deep Level Level Zone (DMLZ) were still ongoing.

Tony is optimistic that this year's production realization will be able to reach the target set at 800 million pounds of copper and 800,000 ounces of gold. Next year, the target will increase significantly to reach 1.4 billion pounds of copper and 1.4 million ounces of gold. He said he was confident that these targets would be able to be achieved.

"We will continue to carry out the under-ground mining ramp-up. This year, the underground mining investment is US$ 1.3 billion and the production position can be achieved according to the target," Tony said in a virtual discussion, Monday (17/8/ 2020).

During the period 2019-2020, PTFI entered into a transition period to fully transition to its underground mining production activities following the cessation of open pit mining operations last year. Therefore, the company's current production capacity is only 60 percent of full capacity. Production at full capacity will only be achieved in 2022.

Meski Covid-19, Freeport Indonesia Yakin Target

Produksi Tercapai Denis Riantiza Meilanova

PT FREEPORT Indonesia optimistis

produksi emas dan tembaga perseroan mampu mencapai target yang direncanakan meskipun terdampak pandemi Covid-19.

Presiden Direktur PT Freeport Indonesia (PTFI) Tony Wenas mengatakan bahwa pandemi Covid-19 berdampak kepada perusahaan. Namun, dia memastikan bahwa kegiatan peningkatan produksi penam-bangan bawah tanah Grasberg Block Cave dan Deep Level Level Zone (DMLZ) tetap berjalan.

Tonyoptimistis realisasi produksi tahun ini mampu mencapai target yang ditetapkan sebesar 800 juta pon tembaga dan 800.000 ounce emas. Tahun depan target tersebut akan meningkat signifikan mencapai 1,4 miliar pon tembaga dan 1,4 juta ounce emas. Pihaknya percaya diri target-target tersebut akan mampu dicapai.

"Ramp-up tambang bawah tanah tetap kami

lakukan. Tahun ini investasi tambang bawah tanah US$1,3 miliar dan posisi produksi bisa

dicapai sesuai target," ujar Tony dalam diskusi virtual, Senin (17/8/2020).

Selama periode 2019-2020, PTFI memasuki masa transisi beralih sepenuhnya pada

kegiatan produksi tambang bawah tanahnya seiring dengan berhentinya operasi tambang

terbuka tahun lalu. Oleh karena itu, kapa-sitas produksi perusahaan saat ini hanya 60

persen dari kapasitas penuh. Produksi dengan kapasitas penuh baru akan tercapai

pada 2022.

IMA-Daily Update Page 6

During the first semester of 2020, the copper produced by Freeport Indonesia reached 321 million pounds, while the gold production of the company operating in Papua from January to June 2020 reached 341,000 ounces.

Although the production capacity is not yet optimal, Tony said that the company's sales could be increased because it was helped by the increase in gold and copper prices.

"Prices rose because China's growth in the second quarter of 2020 grew 3.2 percent and copper imports were quite a lot. This made our income increase, but we still invest in underground so the cash flow is stil l negative, so we haven't given dividends. Dividends [distributed] in 2021," he said.

In the midst of a pandemic, said Tony, the company is also making significant cost efficiencies by delaying a number of projects so that capital expenditures can be reduced by hundreds of millions of US dollars. Editor: Zufrizal

Sepanjang semester I/2020, tembaga yang dihasilkan Freeport Indonesia mencapai 321 juta pon, sedangkan produksi emas perusahaan yang beroperasi di Papua itu sepanjang Januari - Juni 2020 mencapai 341.000 ounce.

Meski kapasitas produksi belum optimal, Tony menyampaikan bahwa penjualan perusahaan dapat ditingkatkan karena tertolong kenaikan harga emas dan tembaga.

"Harga naik karena pertumbuhan China kuartal II/2020 tumbuh 3,2 persen dan impor tembaga cukup banyak. Ini mem-buat penghasilan kami bertambah, tettapi kami tetap investasi untuk bawah tanah jadi cashflow masih negatif, makanya belum beri dividen. Dividen [dibagikan] baru 2021," katanya.

Di tengah pandemi, ujar Tony, perusahaan juga melakukan efisiensi biaya cukup signifikan yang dilakukan dengan me-nunda sejumlah proyek sehingga belanja modal bisa dikurangi hingga ratusan juta dolar AS. Editor : Zufrizal

Jokowi reaffirms Indonesia’s 'massive downstreaming’ of natural

resources Norman Harsono | The Jakarta Post

PRESIDENT Joko “Jokowi” Widodo has reaffirmed that Indonesia’s future natural resources

policy will focus on “massive downstreaming” to produce higher-value products.

The President, speaking before legislators, officials, political elites and foreign ambassadors, highlighted the country's ambitious plans to develop domestic oil refineries, metal smelters,

coal-to-gas facilities and better palm-oil based biodiesel.

“This will narrow down our current account deficit, increase our employment opportunities

and start tackling fossil energy domination,” he said in his state of the nation address delivered before the People's Consultative Assembly in Jakarta on Friday.

IMA-Daily Update Page 7

Jokowi mentioned state-owned oil and gas giant Pertamina’s recent successful trial production of “D100” green diesel, a more engine-friendly biodiesel than the one currently available. He said the production would absorb “a million tons of farmer-produced palm” to produce 20,000 barrels of fuel each day.

Indonesia is the world's largest producer of palm oil, an industry that employs millions of citizens, mostly farmers. However, the palm oil industry is a major contributor to massive forest fires and deforestation.

Jokowi also mentioned the government’s landmark ban on the export of nickel ore, a metal mainly used to produce steel and car batteries. Its demand is expected to rise alongside the rise of electric cars. The ban shook global markets as Indonesia is the world’s largest producer of nickel.

“This will place Indonesia in an even more strategic position in the development of lithium batteries, the world’s electric vehicles and as a future technology producer,” he said.

The President added that Indonesia would reform regulations and continue developing industrial estates, such as those in Batang, West Java, and Subang-Majalengka, West Java, to get more industries to invest in the country.

He promised the giant estates would not undermine Indonesia’s micro, small and medium enterprises, which absorb over 90 percent of the domestic workforce.

Developing downstream industries is part of the Jokowi administration's larger ambition of transforming Indonesia from a commodity-driven economy into an industrial one, with the ultimate goal of becoming the world’s fourth-largest economy by 2045.

After Dropping 50%, United

Tractors (UNTR) Heavy Equipment Sales Rise in 2021

Reporter | Editor: Avanty Nurdiana

DEMAND for PT United Tractors Tbk's

heavy equipment has weakened this year. Indo Premier Sekuritas estimates that United Tractors' heavy equipment sales will reach 1,350-1,400 units, down 50% year on year (yoy) from the previous 2,800-2,900 units in 2019.

However, these guidelines are in line with Indo Premier's estimate of heavy equip-ment sales of 1,450 units. Sales of heavy equipment are...

Usai anjlok 50%, penjualan

alat berat United Tractors (UNTR) bangkit di 2021

Reporter | Editor: Avanty Nurdiana

PERMINTAAN alat berat PT United

Tractors Tbk melemah di sepanjang tahun ini. Indo Premier Sekuritas memperkirakan, penjualan alat berat United Tractors akan mencapai 1.350-1.400 unit atau turun 50% secara year on year (yoy) dari sebelumnya 2.800-2.900 unit di tahun 2019.

Namun pedoman tersebut sejalan dengan perkiraan Indo Premier yang memperkira-kan penjualan alat berat sebanyak 1.450 unit. Penjualan alat berat ini...

IMA-Daily Update Page 8

Sales of heavy equipment are the lowest of all time since 2003. "We think this year's weak sales volume has been taken into account," said Timothy Handerson, Analyst at Indo Premier Sekuritas in research on August 13, 2020.

Indo Premier estimates that heavy equip-ment sales volume will recover to 2,300-3,200 units in 2021-2022 in line with the improving economy and potential capital expenditures of large miners and contractors. This year, many large miners and contractors have postponed capital expenditures and will shift to 2021.

Not only in the heavy equipment sales segment, the mining service business operated by PT Pamapersada Nusantara (Pama) also saw a decrease in volume overbudden. UNTR estimates the volume of overbudden will decline 18% this year.

However, Indo Premier estimates, Pama Persada's volume will only decrease by 14%. This is because most of the coal producers have lowered their production targets by 15-20 percent.

Coal producers also expect discounts from Pama Persada. Where Pama Persada will give a discount of US$ 120 million-US$ 140 million in 2020. "Previously, we estimated there would be a discount of US$ 150 million. Although the prospect of volume is gloomy this year, we are sure that the discount given by UNTR will be much more low," explained Timothy.

Indo Premier estimates that Pama Persada's revenue growth will reach 13% -19% in the next year and 2022. Another recovery from the UNTR business is that coal volume will increase by 7% -8% per year.

In addition, coal prices are also higher from year to year. By 2020, Newcastle coal price will be US$ 55 per tonne. In 2021, it will be US$ 65 per tonne and US$ 70 per tonne in 2022.

Penjualan alat berat ini terendah sepanjang masa sejak 2003. "Kami pikir tahun ini volume penjualan yang melemah telah diper-hitungkan," kata Timothy Handerson Analis Indo Premier Sekuritas dalam riset 13 Agustus 2020.

Indo Premier memperkirakan, volume pen-jualan alat berat akan kembali pulih menjadi 2.300-3.200 unit di tahun 2021-2022 sejalan dengan membaiknya ekonomi dan potensi belanja modal para penambang besar dan kontraktor. Pada tahun ini, penambang besar dan kontraktor banyak yang menunda belanja modal dan akan mengalihkan ke tahun 2021.

Tak hanya pada segmen penjualan alat berat, bisnis jasa pertambangan yang dijalankan oleh PT Pamapersada Nusantara (Pama) juga terjadi penurunan volume overbudden. UNTR memperkirakan volume overbudden akan menurun 18% di tahun ini.

Namun, Indo Premier memperkirakan, volume Pama Persada hanya akan turun 14%. Pasalnya, sebagian besar produsen batubara telah menurunkan target produksi sebesar 15%-20%.

Para produsen batubara juga mengharapkan diskon dari Pama Persada. Dimana Pama Persada akan memberi diskon US$ 120 juta-US$ 140 juta di tahun 2020. "Sebelumnya, kami memperkirakan akan ada diskon sebesar US$ 150 juta. Meski prospek volume-nya suram di tahun ini tapi kami yakin diskon yang diberikan UNTR akan jauh lebih rendah," jelas Timothy.

Indo Premier memperkirakan, pertumbuhan pendapatan Pama Persada akan mencapai 13%-19% pada tahun depan dan tahun 2022. Pemulihan lain dari bisnis UNTR adalah volume batubara akan meningkat 7%-8% per tahun.

Selain itu, harga batubara juga lebih tinggi dari tahun ke tahun. Pada tahun 2020, harga batubara Newcastle akan beada di US$ 55 per ton. Pada 2021 sebesar US$ 65 per ton dan US$ 70 per ton pada tahun 2022.

IMA-Daily Update Page 9

Another positive factor for the discount given by Pama Persada will be a minimum of US$ 20 million-US$ 30 million in 2021 and 2022.

UNTR will also reap more profits from the Martabe gold mine. In the midst of less than optimal production activities, UNTR estimates that gold production will be as much as 300,000 per troi ounce. This figure is lower than the initial target of 360,000 per troi ounce by 2020.

Martabe volume will recover in 2021 to 350,000 per troi ounce. Timothy said, this had been predicted beforehand.

Going forward, UNTR's strategy of using hedging is more conservative. That is to use the fixed forward contract sell option with a lower proportion in 2021. This would be good enough for the average selling price despite the recent correction in the price of gold.

"We still see many positive sides for UNTR with a large discounted stock valuation compared to similar industries," explained Timothy in his research.

For this reason, Timothy still recommends buying UNTR shares with a target of Rp 26,500 per share. "Because we believe this year's performance will be weaker than previously thought," he explained.

Faktor positif lain diskon yang diberikan Pama Persada akan minimal US$ 20 juta-US$ 30juta di tahun 2021 dan 2022.

UNTR juga akan menuai lebih banyak keuntungan dari tambang emas Martabe. Di tengah kegiatan produksi yang kurang optimal UNTR memperkirakan produksi emas sebanyak 300.000 per ons troi. Angka ini lebih rendah dari target awal 360.000 per ons troi pada tahun 2020.

Volume Martabe akan kembali pulih pada tahun 2021 menjadi 350.000 per ons troi. Timothy menyebut, hal ini sudah diper-kirakan sebelumnya.

Ke depannya, strategi UNTR menggunakan lindung nilai lebih konservatif. Yaitu meng-gunakan opsi jual kontrak forward tetap dengan proporsi yang lebih rendah pada tahun 2021. Hal ini akan cukup baik untuk harga jual rata-rata meskipun baru-baru ini terjadi koreksi harga emas.

"Kami masih melihat banyak sisi positif untuk UNTR dengan valuasi saham yang terdiskon besar dibanding industri sejenis-nya," terang Timothy dalam riset.

Karena alasan tersebut, Timothy masih menyarankan beli saham UNTR dengan target Rp 26.500 per saham. "Karena kami yakin pada tahun ini kinerja akan lebih lemah

dari diperkirakan sebelumnya," terang dia.

Developing underground mining, Freeport invests US$1.3

billion Denis Riantiza Meilanova

THIS year, PT Freeport Indonesia this year

has invested US$ 1.3 bil l ion for the development of its underground mining in Papua.

Kembangkan Tambang Bawah Tanah, Freeport Investasi

US$1,3 Miliar Denis Riantiza Meilanova

TAHUN ini, PT Freeport Indonesia tahun

ini menggelontorkan investasi US$1,3 miliar untuk pengembangan penambangan bawah tanahnya di Papua.

IMA-Daily Update Page 10

President Director of PT Freeport Indonesia (PTFI) Tony Wenas said that during the 2019-2020 period, the company was entering a transition period to fully transition to the underground mining production activities of the Grasberg Block Cave and Deep Level Level Zone (DMLZ) in line with the cessation of open mining operations last year.

Therefore, the company's current production capacity is only 60 percent of full capacity. Production at full capacity will only be achieved in 2022.

"This year, underground mining invest-ment is US$ 1.3 billion. Because it has to invest US$ 1.3 billion, cash flow is still negative," Tony said in a virtual discussion, Monday (17/8/2020).

Based on the financial reports and operations of the second quarter of 2020 of Freeport-McMoRan Inc., the holding company of Freeport Indonesia, the ore production capacity at the Grasberg Block Cave and DMLZ underground mines reached 54,800 tons per day during the second quarter of this year. This realization is above 9 percent of the projection and is up 46 percent compared to the first quarter of 2020.

During the second quarter of this year, Freeport Indonesia added 46 new drawbells in the underground mine, bringing the total drawbell opened to date reaching 261 drawbells. New drawbells will continue to be added to increase production.

Freeport Indonesia targets copper and gold production in 2021 to double this year. Next year's copper production is targeted to reach 1.4 billion pounds, while gold will reach 1.4 million ounces.

After the underground mine development is completed, it is hoped that Freeport Indonesia's average annual production for the next few years can reach 1.55 billion pounds of copper and 1.6 million ounces of gold.

Presiden Direktur PT Freeport Indonesia (PTFI) Tony Wenas menyampaikan bahwa sepanjang periode 2019-2020, perusahaan tengah memasuki masa transisi beralih sepenuhnya pada kegiatan produksi tambang bawah tanah Grasberg Block Cave dan Deep Level Level Zone (DMLZ) seiring dengan berhentinya operasi tambang ter-buka tahun lalu.

Oleh karena itu, kapasitas produksi per-usahaan saat ini hanya 60 persen dari kapasitas penuh. Produksi dengan kapasitas penuh baru akan tercapai pada 2022.

"Tahun ini investasi tambang bawah tanah US$1,3 miliar. Karena harus investasi US$1,3 miliar, cash flow masih negatif," ujar Tony dalam diskusi virtual, Senin (17/8/2020).

Berdasarkan laporan keuangan dan operasi kuartal II/2020 Freeport-McMoRan Inc., induk usaha Freeport Indonesia, kapasitas produksi bijih di tambang bawah tanah Grasberg Block Cave dan DMLZ mencapai 54.800 ton per hari sepanjang kuartal kedua tahun ini. Realisasi ini di atas 9 persen dari proyeksi dan naik 46 persen dibandingkan dengan kuartal I/2020.

Sepanjang kuartal kedua tahun ini, Freeport Indonesia menambah 46 drawbell baru di tambang bawah tanah sehingga total draw-bell yang dibuka sampai saat ini mencapai 261 drawbell. Drawbell baru akan terus ditambah untuk meningkatkan produksi.

Freeport Indonesia menargetkan produksi tembaga dan emas pada 2021 dapat meningkat dua kali lipat dibandingkan tahun ini. Produksi tembaga tahun depan di-targetkan dapat mencapai 1,4 miliar pon, sementara emas mencapai 1,4 juta ounce.

Usai pengembangan tambang bawah tanah rampung, nantinya diharapkan rerata produksi tahunan Freeport Indonesia untuk beberapa tahun ke depan dapat mencapai 1,55 miliar pon tembaga dan 1,6 juta ounce emas.

IMA-Daily Update Page 11

Freeport Indonesia's annual capital for this underground development project is estimated at around US$ 900 million per year for the period 2020 to 2022. Editor: Zufrizal

Modal tahunan Freeport Indonesia untuk proyek pengembangan bawah tanah ini diperkirakan mencapai sekitar US$900 juta per tahun untuk periode 2020 hingga 2022. Editor : Zufrizal

Facts on Nickel Downstreaming

Encouraged by Jokowi

PRESIDENT Joko Widodo (Jokowi) said

that the government has carried out a number of downstreaming of mines, especially nickel. The goal is to improve the current account deficit (CAD), increase employment opportunities, and reduce the dominance of fossil energy.

The downstream efforts include processing nickel ore into ferronickel, stainless steel slabs, steel sheets, and the main material for lithium batteries.

"This will make Indonesia a strategic position in the development of lithium batteries, world electric cars, and technology producers in the future," Jokowi said at the MPR annual session, Friday (14/8) morning.

In fact, the government has banned the export of official nickel ore (ore) on January 1, 2020. This policy is accelerated from before in 2022 through the Minister of EMR Regulation Number 11 of 2019 concerning the Second Amendment to the Minister of EMR Regulation Number 25 of 2018 concerning Mineral and Coal Mining Business.

Furthermore, business entities are asked to increase the capacity of processing and refining facilities (smelters) to increase added value.

Fakta Hilirisasi Nikel yang

Digalakkan Jokowi

PRESIDEN Joko Widodo (Jokowi) menga-

takan pemerintah telah melakukan sejumlah hilirisasi tambang, terutama nikel. Tujuannya untuk memperbaiki defisit transaksi berjalan (current account deficit/CAD), meningkatkan peluang kerja, serta mengurangi dominasi energi fosil.

Upaya hilirisasi itu meliputi pengolahan bijih nikel menjadi feronikel, stainless steel slab, lembaran baja, dan bahan utama untuk baterai lithium.

"Hal ini akan membuat posisi Indonesia menjadi strategis dalam pengembangan baterai lithium, mobil listrik dunia, dan produsen teknologi di masa depan," tutur Jokowi dalam sidang tahunan MPR, Jumat (14/8) pagi.

Faktanya, pemerintah telah melarang ekspor bijih (ore) nikel resmi pada 1 Januari 2020. Kebijakan ini dipercepat dari sebelumnya pada 2022 melalui Permen ESDM Nomor 11 Tahun 2019 soal Perubahan Kedua Atas Permen ESDM Nomor 25 Tahun 2018 tentang Pengusahaan Pertambangan Mineral dan Batu Bara.

Selanjutnya, badan usaha diminta untuk meningkatkan kapasitas fasilitas peng-olahan dan pemurnian (smelter) untuk meningkatkan nilai tambah.

IMA-Daily Update Page 12

In 2019, the Ministry of EMR revealed that nickel ore exports reached 30 million tons

in 2019. This figure is up 36.36 percent from the previous export, which was 22

million tons.

However, Energy Watch Indonesia observer Mamit Setiawan assessed that

nickel downstream has not developed significantly. This is because many

companies have not committed to smelter construction due to various problems.

"So, more assertiveness is needed so that

the company's commitment can really be implemented," he told CNNIndonesia.com.

He agreed with Jokowi's statement that the downstreaming of this energy could

significantly increase the added value of nickel. This effort is also believed to be able

to increase state revenue coffers.

"So we do not sell raw material," he explained.

Mamit's statement is in line with the fact

that the Ministry of EMR has cut the projected smelter construction from 68 to

only 52 in 2022.

"Our smelters (have) conducted an

evaluation. From the (initial target) 68 (smelters), now it has turned into 52. But

in line with that, hopefully it can be 68 as well (in the future)," explained the Director

of Business Development at the Directorate General of Minerba Yunus

Saefulhak at the Office of the Directorate General of Minerba.

The decline in smelter projection is largely

due to the reduction in nickel smelters. Based on Yunus' exposure, the nickel

smelters which were originally targeted to be 41 smelters fell to 29. (ulf/bir)

Pada 2019 lalu, Kementerian ESDM meng-ungkap ekspor bijih nikel mencapai 30 juta

ton pada 2019. Angka tersebut naik 36,36 persen dari ekspor sebelumnya, yakni 22

juta ton.

Namun, Pengamat Energi dari Energy

Watch Indonesia Mamit Setiawan menilai hilirisasi nikel belum berkembang secara

signifikan. Pasalnya, banyak perusahaan belum berkomitmen untuk pembangunan

smelter, karena berbagai permasalahan.

"Jadi, diperlukan ketegasan lagi agar

komitmen perusahaan benar-benar bisa dilaksanakan," katanya kepada CNN-

Indonesia.com.

Ia mengamini pernyataan Jokowi jika

hilirisasi energi ini bisa mengerek nilai tambah nikel secara signifikan. Upaya ini

juga diyakini bisa menambah pundi pendapatan negara.

"Jadi kita tidak menjual raw material (bahan mentah)," jelasnya.

Pernyataan Mamit sejalan dengan fakta bahwa Kementerian ESDM memangkas

proyeksi pembangunan smelter dari 68 menjadi hanya 52 pada 2022 mendatang.

"Smelter kami (sudah) lakukan evaluasi. Dari yang (target awal) 68 (smelter),

kemudian sekarang ini berubah menjadi 52. Tapi sejalan dengan itu, mudah-

mudahan bisa menjadi 68 juga (ke depan)," terang Direktur Pembinaan Pengusahaan

Ditjen Minerba Yunus Saefulhak di Kantor Ditjen Minerba.

Penurunan proyeksi smelter tersebut sebagian besar disebabkan oleh ber-

kurangnya smelter nikel. Berdasarkan paparan Yunus, smelter nikel yang semula

ditargetkan berjumlah 41 smelter turun menjadi 29. (ulf/bir)

IMA-Daily Update Page 13

Welcoming the supervisory task force, APNI hopes that the HPM

regulation can be realized Reporter: Ridwan Nanda Mulyana | Editor:

Anna Suci Perwitasari

THE INDONESIAN Nickel Miners Association (APNI) welcomes the formation of a task force to supervise the trade system and domestic nickel prices, through the issuance of the Decree of the Coordinating Minister for Maritime Affairs and Investment Number 108 of 2020 concerning a working team to supervise the implementation of the nickel Mineral Reference Price (HPM).

APNI Secretary General Meidy Katrin Lengkey hopes that with the formation of the supervisory working team, the rules for the domestic nickel trade system which refer to HPM can be realized. That way, mining with the principles of good mining practice can also be done.

"Hopefully with the presence of the HPM Task Force team, the implementation of HPM is truly obeyed by all nickel actors, both miners and smelters," Meidy told Kontan.co.id, Monday (17/8).

The reason is that until this August, the Ministerial Regulation (Permen) ESDM Number 11 of 2020 which regulates the domestic nickel trade system based on HPM has not been realized. According to Meidy, nickel ore transactions from miners to smelter companies do not refer to HPM but are still based on business to business (b to b).

"Until today, there has been no new contract that is in accordance with HPM. Maybe the Minister of Coordinating Decree 108/2020 should first socialize it so that all nickel actors, both miners and Smelter, understand and are clear," he said.

Sambut baik satgas pengawas, APNI berharap aturan HPM

bisa terealisasi Reporter: Ridwan Nanda Mulyana | Editor:

Anna Suci Perwitasari

ASOSIASI Penambang Nikel Indonesia (APNI) menyambut baik terbentuknya satuan tugas (satgas) pengawasan tata niaga dan harga nikel domestik, melalui terbitnya Keputusan Menteri Koordinator Bidang Kemaritiman dan Investasi Nomor 108 tahun 2020 tentang tim kerja pengawasan pelaksanaan Harga Patokan Mineral (HPM) nikel.

Sekretaris Jenderal APNI Meidy Katrin Lengkey berharap, dengan terbentuknya tim kerja pengawasan tersebut, aturan tata niaga nikel domestik yang mengacu pada HPM bisa terealisasi. Dengan begitu, penam-bangan dengan prinsip good mining practice juga bisa terlaksana.

"Semoga dengan hadirnya tim Satgas HPM, pelaksanaan HPM benar-benar dipatuhi oleh seluruh pelaku nikel, baik penambang maupun smelter," kata Meidy kepada Kontan.co.id, Senin (17/8).

Pasalnya hingga bulan Agustus ini, Peraturan Menteri (Permen) ESDM Nomor 11 tahun 2020 yang mengatur tentang tata niaga nikel domestik berdasarkan HPM belum juga terealisasi. Menurut Meidy, transaksi bijih nikel dari penambang ke perusahaan smelter belum mengacu HPM tapi masih berdasarkan business to business (b to b).

"Sampai hari ini sih belum ada kontrak baru yang sudah sesuai HPM. Mungkin harus disosialisasikan dulu Kepmenko 108/2020 sehingga semua pelaku nikel baik penambang dan Smelter paham dan jelas," ujar dia.

IMA-Daily Update Page 14

Domestic nickel ore transactions that refer to HPM are intended to create a more equitable trading system. Previously, APNI protested that the domestic nickel trading system was detrimental to miners, whose transaction prices are often lower than the cost of production (HPP) of nickel ore.

Meidy gave an illustration, for July 2020 the HPM for nickel ore for a 1.8% grade was set at US$ 30.15 per wet metric ton (wmt) with the Free on Board (FOB) sales scheme.

However, according to him, the price purchased by the local smelter is far below that, which is US$ 20 per wmt on FOB basis or US$ 27 per wmt using the Cost, Insurance, and Freight (CIF) scheme.

This price is still below the Cost of Production (HPP). He said, the cost to produce nickel grade 1.8% is around US$ 21.79 per ton and the estimated shipping costs are between US$ 5-US$ 6.Therefore, CIF costs reach US$ 26.79-US$ 27.79 per wmt.

Meanwhile, the nickel metal HPM listed in Permen ESDM No. 11/2020 is the floor price that miners and smelters must obey. Even if the transaction price is lower than the HPM in a certain period or because there is a penalty for impurity minerals, the sale can be made under the HPM by a maximum difference of 3%.

To ensure the application of HPM in the nickel trade system, the government formed a supervisory working team. The Coordinating Minister for Maritime Affairs and Investment (Menko Marves) Luhut Binsar Pandjaitan issued the Decree of the Coordinating Minister for Marves Number 108 of 2020, on August 13, 2020.

The regulation stated that the working team carried out the technical task of supervising the sale and purchase of nickel ore between mining businesses and smelters. There are seven scopes of the work team.

Transaksi bijih nikel domestik yang mengacu pada HPM dimaksudkan untuk menciptakan tata niaga yang lebih berkeadilan. Sebelumnya, APNI memprotes bahwa tata niaga nikel domestik merugikan penambang, yang bahkan tak jarang harga transaksi lebih rendah dari Harga Pokok Produksi (HPP) bijih nikel.

Meidy sempat memberikan gambaran, untuk bulan Juli 2020 HPM bijih nikel untuk kadar 1,8% ditetapkan sebesar US$ 30,15 per wet metric ton (wmt) dengan skema penjualan Free on Board (FOB).

Namun menurutnya, harga yang dibeli oleh smelter lokal jauh di bawah itu, yakni sebesar US$ 20 per wmt secara FOB atau US$ 27 per wmt dengan memakai skema Cost, Insurance, and Freight (CIF).

Harga itu masih di bawah Harga Pokok Produksi (HPP). Kata dia, biaya untuk memproduksi nikel kadar 1,8% sekitar US$ 21,79 per ton dan estimasi biaya pengapalan antara US$ 5-US$ 6. Maka biaya CIF mencapai US$ 26,79-US$ 27,79 per wmt.

Adapun, HPM logam nikel yang tercantum dalam Permen ESDM No. 11/2020 merupa-kan harga batas bawah (floor price) yang harus ditaati oleh penambang dan smelter. Sekalipun harga transaksi lebih rendah dari HPM pada periode tertentu atau karena ada penalti atas mineral pengotor (impurties), penjualan dapat dilakukan di bawah HPM dengan selisih paling tinggi 3%.

Untuk memastikan berlakunya HPM pada tata niaga nikel, pemerintah membentuk tim kerja pengawasan. Menteri Koordinator Bidang Kemaritiman dan Investasi (Menko Marves) Luhut Binsar Pandjaitan mener-bitkan Keputusan Menko Marves Nomor 108 tahun 2020, pada 13 Agustus 2020.

Beleid tersebut menyebutkan, tim kerja tersebut melakukan tugas teknis pengawasan terhadap transaksi jual beli bijih nikel antara pelaku usaha pertambangan dan smelter. Ada tujuh cakupan tugas dari tim kerja tersebut.

IMA-Daily Update Page 15

First, ensure that the price used in buying/ selling nickel ore is in accordance with the HPM. Second, ensuring the ore being traded is ore mined from the IUP area which has Clean and Clear status and is in accordance with the agreed contract.

Third, eradicating traders' activities that are detrimental to mining business actors and end users of nickel ore. Fourth, ensure that the surveyor companies used by the seller and buyer of ore have been registered with the ministry/agency and have carried out their business activities in accordance with applicable standards and regulations.

Fifth, ensure that mining companies apply the principles of good mining management in their IUP areas in accordance with applicable regulations, and ensure processing and refining companies carry out occupational health and safety management, environmental management, and sound trade.

Sixth, monitoring compliance reports on the Minister of EMR Regulation Number 11 of 2020 which is submitted quarterly by mining business actors and processing and refining business actors. Seventh, provide recommendations to the competent Ministries and Institutions to impose sanctions on violating parties.

Referring to the attachment of the regulation, the working team steering consists of the heads of ministries and related institutions. Namely the Coordinating Minister for Marves, the Minister of EMR, the Minister of Industry, the Minister of Trade, the Minister of Finance, and the Head of the Investment Coordinating Board (BKPM).

Meanwhile, the head of the implementing work team is the Deputy for Investment and Mining Coordination at the Coordinating Ministry for Marves. The Deputy Chair of this team consists of...

Pertama, memastikan harga yang digunakan dalam transaksi jual/beli bijih nikel sesuai dengan HPM. Kedua, memastikan bijih yang diperjualbelikan merupakan bijih yang ditambang dari wilayah IUP yang telah berstatus Clean and Clear serta sesuai dengan kontrak yang disepakati.

Ketiga, memberantas aktivitas traders yang merugikan bagi pelaku usaha pertambangan dan pengguna akhir bijih nikel. Keempat, memastikan perusahaan surveyor yang digunakan oleh pihak penjual dan pembeli bijih telah terdaftar di kementerian/lembaga, serta telah melaksanakan kegiatan usahanya sesuai standar dan ketentuan yang berlaku.

Kelima, memastikan perusahaan pertam-bangan menerapkan prinsip-prinsip penge-lolaan tambang yang baik dalam wilayah IUP-nya sesuai dengan ketentuan yang berlaku, serta memastikan perusahaan peng-olahan dan pemurnian melaksanakan manajemen kesehatan dan keselamatan kerja, pengelolaan lingkungan, serta perda-gangan yang baik.

Keenam, memantau laporan kepatuhan atas Peraturan Menteri ESDM Nomor 11 Tahun 2020 yang disampaikan secara triwulanan oleh pelaku usaha pertambangan dan pelaku usaha pengolahan dan pemurnian. Ketujuh, memberikan rekomendasi kepada Kemen-terian dan Lembaga berwenang untuk memberikan sanksi terhadap pihak yang melanggar.

Merujuk pada lampiran beleid tersebut, pengarah tim kerja terdiri dari pimpinan kementerian dan lembaga terkait. Yakni Menko Marves, Menteri ESDM, Menteri Perindustrian, Menteri Perdagangan, Menteri Keuangan, dan Kepala Badan Koordinasi Penanaman Modal (BKPM).

Sedangkan ketua tim kerja pelaksana adalah Deputi Bidang Koordinasi Investasi dan Pertambangan Kemenko Marves. Wakil Ketua tim ini terdiri dari...

IMA-Daily Update Page 16

The Deputy Chair of this team consists of the Director General of Minerba, Ministry of EMR; Director General of Metal, Machinery, Transportation Equipment and Electronics at the Ministry of Industry; Director General of Resilience, zoning, and international industrial access at the MoI; Director General of consumer protection and trade order of the MoT; Director General of Customs and Excise, Ministry of Finance; and Deputy for Investment Promotion at BKPM.

Meanwhile, the members consist of the Coordinating Ministry for Marves (10 representatives), the Ministry of EMR (10 rep.), the Ministry of Industry (6 rep.), the Ministry of Trade (3 rep.), the Ministry of Finance (4 representatives) and the BKPM (6 representatives).

Wakil Ketua tim ini terdiri dari Direktur

Jenderal (Dirjen) Minerba Kementerian

ESDM; Dirjen Industri Logam, Mesin, Alat

Transportasi dan Elektronika Kemenperin;

Dirjen Ketahanan, pewilayahan, dan akses

industri internasional Kemenperin; Dirjen

Perlindungan konsumen dan tertib niaga

Kemendag; Dirjen Bea dan Cukai

Kemenkeu; dan Deputi Bidang Promosi

penanaman modal BKPM.

Sedangkan anggotanya terdiri dari pihak

Kemenko Marves (10 perwakilan),

Kementerian ESDM (10 perwakilan),

Kemenperin (6 perwakilan), Kementerian

perdagangan (3 perwakilan), Kemenkeu (4

perwakilan) dan BKPM (6 perwakilan).

Next year Freeport aims to increase production

Rep: Intan Pratiwi / Ed: Friska Yolandha, Fuji Pratiwi

THE IMPACT of the pandemic and the

depletion of reserves in open pits has caused PT Freeport Indonesia (PTFI)'s gold and copper production to decline this year. However, next year, PTFI is committed to starting to record an increase in production.

PTFI President Director Tony Wenas explained that currently PTFI's production condition is only 60 percent of its production capacity. This is because indeed the reserves in the open pit have run out and only come out of the reserve. Currently, concentrate ore sales are 800 million pounds of copper and 8,000 ounces of gold.

"Next year we believe our target will increase and we believe this can be achieved. Next year we will produce...

Tahun Depan Freeport Bidik Kenaikan Produksi

Rep: Intan Pratiwi / Red: Friska Yolandha, Fuji Pratiwi

DAMPAK pandemi dan habisnya

cadangan di open pit membuat produksi emas dan tembaga PT Freeport Indonesia (PTFI) turun pada tahun ini. Namun, pada tahun depan, PTFI berkomitmen akan mulai mencatatkan kenaikan produksi.

Presiden Direktur PTFI, Tony Wenas menjelaskan saat ini kondisi produksi PTFI hanya 60 persen dari kapasitas produksi. Hal ini karena memang cadangan di open pit sudah habis dan hanya mengeluarkan dari simpanan cadangan. Saat ini tercatat penjualan bijih konsentrat sebesar 800 juta pound tembaga dan 8.000 ons emas.

"Pada tahun depan kami yakin target kami naik dan kami yakin ini bisa tercapai. Tahun depan kami akan memproduksi...

IMA-Daily Update Page 17

Next year we will produce 1.4 billion pounds of copper and 1.4 million ounces of gold," Tony said in a virtual discussion, Monday (17/8).

He also ensured that this year's sales will still be good due to the support of the rising gold and copper prices. "This price rose because China's growth in the second quarter grew 3.2 percent and copper imports were quite a lot. World supply decreased, China's demand increased, so prices rose. This made our income increase," added Tony.

Tony explained that in order to increase production next year, PTFI will also conduct underground mining. Tony explained that the company spent 1.3 billion US dollars for underground invest-ment.

"We will continue to do underground mining. This year, we will invest 1.3 billion US dollars for underground mining," said Tony.

Impact of the Pandemic, Freeport Smelter Construction Stops

The impact of the Covid-19 Pandemic has forced the construction of the PT Freeport Indonesia (PTFI) smelter to stop. PTFI President Director Tony Wenas explained that it has been five months since there had been no activity in Gresik.

Tony explained that last February the smleter construction progress had reached 5.8 percent. Unfortunately, starting March construction activities have stopped due to activities in Gresik, the Freeport construction site being closed.

"We practically stopped for five months because Gresik also stopped. Our main contractor was also affected by the pandemic. We have had no activities in the last five months," Tony said in a virtual discussion, Monday (17/8).

Tahun depan kami akan memproduksi 1,4 miliar pound tembaga dan 1,4 juta ons emas," ujar Tony dalam diskusi virtual, Senin (17/8).

Ia juga memastikan penjualan tahun ini tetap akan baik akan karena tertolongnya harga emas dan tembaga yang bergerak naik. "Ini harga naik karena pertumbuhan China di kuartal II tumbuh 3,2 persen dan impor tembaga cukup banyak. Suplai dunia berkurang, permintaan China naik, makanya harga naik. Ini membuat penghasilan kita bertambah," tambah Tony.

Tony menjelaskan untuk bisa menambah produksi di tahun depan, PTFI juga akan melakukan penambangan di underground mining. Tony menjelaskan perusahaan mengeluarkan 1,3 miliar dolar AS untuk investasi bawah tanah.

"Tambang bawah tanah tetap kita lakukan. Tahun ini investasi 1,3 miliar dolar AS untuk tambang bawah tanah," ujar Tony.

Dampak Pandemi, Pembangunan Smelter Freeport Terhenti

Dampak Pandemi Covid-19 memaksa pem-bangunan smelter PT Freeport Indonesia (PTFI) harus berhenti. Presiden Direktur PTFI, Tony Wenas menjelaskan sudah lima bulan ini tidak ada aktivitas apa apa di Gresik.

Tony menjelaskan terakhir pada Februari kemarin progres pembangunan smleter sudah mencapai 5,8 persen. Sayangnya, mulai Maret aktivitas pembangunan ter-henti karena aktivitas di Gresik, lokasi pembangunan Freeport tertutup.

"Lima bulan kita praktis berhenti karena Gresik juga berhenti. Kontraktor utama kta juga terkena dampak pandemi. Kita lima bulan ini gak ada kegiatan," ujar Tony dalam diskusi virtual, Senin (17/8).

IMA-Daily Update Page 18

Because of this, Tony predicts that the operation of the smelter factory, which is

planned to start in 2023, will automatically be delayed by one year. He explained that

he had proposed to relax this condition to the government but there was no official

answer.

"A few months ago we submitted this

request to be postponed for a period of 12 months. There is already an under-

standing, but the official approval is not yet obtained," said Tony.

Tony assessed that the construction of a copper refining plant or smelter is not

profitable for both the company and the state. This is because the added value of

the selling price from concentrate to cathode copper is only 5 percent.

The added value of only five percent is not proportional to the selling price if it is

exported and the spending that must be spent by the state and companies. Even so,

Tony explained that because it was included in the transfer of the work

contract, it would still be carried out.

"It also needs to be understood that this

planting is not profitable. The main result of copper smelter is refenery. The added

value of the ore to the constrates is already 5 percent ," Tony said in a virtual

discussion, Monday (17/8).

The company will continue to build a

smelter in Gresik because it is close to the Petrochemical factory which will absorb

sulfuric acid from the refining process. Thus, logistics costs are much cheaper.

"PTFI will build a new smleter. All PTFI concentrate will be processed domesti-

cally. That is what we are doing now, although it is too late. Regardless, we will

continue to build," said Tony.

Karena hal tersebut, Tony memprediksi pengoperasian pabrik smelter yang rencana akan mulai pada 2023 otomatis akan mundur satu tahun. Ia menjelaskan sudah mengajukan relaksasi kondisi ini kepada pemerintah namun belum ada jawaban resmi.

"Kita beberapa bulan lalu menyampaikan permohonan ini untuk ditunda dalam jangka waktu 12 bulan. Sudah ada pemahaman, tapi resminya belum dapat persetujuan," ujar Tony.

Tony menilai pembangunan pabrik pemurnian atau smelter tembaga tidaklah menguntungkan baik bagi perusahaan maupun negara. Sebab, nilai tambah harga jual dari konsentrat ke tembaga katoda hanya 5 persen.

Nilai tambah yang hanya lima persen ini tidak sebanding dengan harga jual jika diekspor dan spending yang harus di-keluarkan oleh negara dan perusahaan. Meski begitu, Tony menjelaskan karena sudah termuat dalam peralihan kontrak karya maka akan tetap dilakukan.

"Ini juga perlu dipahami pembanuhan ini memang bukan menguntungkan. Smleter tembaga itu hasil utamanya adalah refenery itu. Nilai tambah dari bijih ke konstrat sudah 5 persen," ujar Tony dalam diskusi virtual, Senin (17/8).

Perusahaan akan tetap melakukan pembangunan smelter di Gresik karena dekat dengan pabrik Petrokimia yang akan menyerap asam sulfat dari proses permurnian. Sehingga, biaya logistik jauh lebih murah.

"PTFI akan bangun satu smleter baru. Seluruh konsentrat PTFI akan bisa diolah didalam negeri. Itu adalah yang sedang kita lakukan sekarang meski memang ter-lambat. Terlepas dari itu, kita akan tetap bangun," ujar Tony.

IMA-Daily Update Page 19

Papua's Economic Growth Grows 4.2

Percent

During the second quarter of this year, the

national economic growth contracted to

5.2 percent. However, in Papua itself,

economic growth has experienced positive

growth of up to 4.2 percent.

President Director of PT Freep ort

Indonesia (PTFI), Tony Wenas explained,

when national economic growth has

contracted, economic growth in Papua has

grown positively. Tony explained that in

the second quarter, Papua's economic

growth grew 4.2 percent.

"In the midst of Covid-19, Papua's

economy has grown 4.2 percent. Of which

29 percent is contributed by mining and

excavation driven by PTFI. This is also a

contribution from us," Tony said in a

virtual discussion, Monday (17/8).

Tony explained that this growth indicates

that PTFI, which is located even from the

easternmost part of Indonesia, has a

significant contribution. Tony hopes that

by reducing the pandemic, the contribution

of economic growth from Papua will be

greater.

Tony ensures that next year PTFI itself will

make a bigger contribution to the nation.

He ensured that next year PTFI will start

giving dividends of up to US$ 40 billion.

Pertumbuhan Ekonomi Papua Tumbuh 4,2 Persen

Selama kuartal dua tahun ini pertumbuhan

ekonomi nasional mengalami kontraksi hingga 5,2 persen. Namun, di Papua sendiri

pertumbuhan ekonomi mengalami per-tumbuhan positif hingga 4,2 persen.

Presiden Direktur PT Freeport Indonesia

(PTFI), Tony Wenas menjelaskan, di saat pertumbuhan ekonomi secara nasional

mengalami kontraksi , pertumbuhan ekonomi di Papua malah tumbuh positif.

Tony menjelaskan kuartal dua, per-tumbuhan ekonomi Papua tumbuh 4,2

persen.

"Di tengah Covid-19 ini, ekonomi papua tumbuh 4,2 persen. Dimana 29 persennya

dari sumbangsih pertambangan dan pergalian dimotori oleh PTFI. Ini suatu

kontribusi juga dari kita," ujar Tony dalam diskusi virtual, Senin (17/8).

Tony menjelaskan pertumbuhan ini

menandakan PTFI yang letaknya bahkan

dari paling timur Indonesia memiliki

kontribusi yang cukup signifikan. Tony

berharap dengan meredanya pandemi

maka kontribusi pertumbuhan ekonomi

dari Papua akan lebih besar.

Tony memastikan tahun depan PTFI

sendiri akan memberikan kontribusi lebih

besar bagi bangsa. Ia memastikan tahun

depan PTFI akan mulai memberikan

deviden sampai 40 miliar dolar AS.

IMA-Daily Update Page 20

The Supervisory Team for Nickel Trade formed, AP3I is still hoping to adjust the price

formula Reporter: Ridwan Nanda Mulyana | Editor:

Anna Suci Perwitasari

THE GOVERNMENT formed a supervisory team for the domestic nickel trade system through the issuance of a Decree of the Coordinating Minister for Maritime Affairs and Investment Number 108 of 2020 concerning a team to supervise the implementation of the nickel benchmark price (HPM).

The Association of Indonesian Processing and Refining Companies (AP3I) hopes that the supervisory team can be a fair umpire in domestic nickel business transactions.

"Let's give the government, led by the Deputy of the Ministry of Maritime Affairs and Investment in the EMR sector, to be a fair referee between miners and smelters," said AP3I Chairman Prihadi Santoso to Kontan.co.id, Monday (17/8).

As is well known, the trade system and domestic nickel prices have indeed caused polemics. This is because, even though it is based on a business to business (b to b) contract, so far the price of nickel ore transactions has been determined more by smelter companies.

The Ministry of EMR then issued Ministerial Regulation (Permen) ESDM Number 11 of 2020 which regulates the domestic nickel trading system based on HPM. However, since it was published in April 2020, the regulation has not been obeyed.

Tim pengawas tata niaga Nikel dibentuk, AP3I masih berharap

penyesuaian formula harga Reporter: Ridwan Nanda Mulyana | Editor:

Anna Suci Perwitasari

PEMERINTAH membentuk tim pengawas

tata niaga nikel domestik melalui terbitnya Keputusan Menteri Koordinator Bidang

Kemaritiman dan Investasi Nomor 108 tahun 2020 tentang tim kerja pengawasan

pelaksanaan Harga Patokan Mineral (HPM) nikel.

Asosiasi Perusahaan Pengolahan dan Pemurnian Indonesia (AP3I) berharap tim

pengawas tersebut bisa menjadi wasit yang adil dalam transaksi bisnis nikel di

dalam negeri.

"Mari berikan kesempatan pemerintah

yang dipimpin oleh Deputi Kemenko Marves bidang ESDM untuk jadi wasit yang

adil antara penambang dan smelter," kata Ketua Umum AP3I Prihadi Santoso kepada

Kontan.co.id, Senin (17/8).

Seperti diketahui, tata niaga dan harga

nikel domestik memang memunculkan polemik. Pasalnya, meski berdasarkan

kontrak business to business (b to b), namun selama ini harga transaksi bijih

nikel lebih ditentukan oleh perusahaan smelter.

Kementerian ESDM pun lantas menerbit-kan Peraturan Menteri (Permen) ESDM

Nomor 11 tahun 2020 yang mengatur tentang tata niaga nikel domestik ber-

dasarkan HPM. Namun, sejak diterbitkan pada April 2020 lalu regulasi tersebut

belum ditaati.

IMA-Daily Update Page 21

According to Prihadi, this regulation has not yet been realized because business actors are still reviewing and making a number of considerations. "Please forget the achievements of the period March to August 2020, this is because all parties are stil l learning and measuring their respective strengths," he explained.

However, AP3I has not explicitly guaranteed that smelter businesses can immediately apply HPM as a reference for nickel ore transactions, even though the government has formed a supervisory team. Because, smelter business actors still hope that there will be an adjustment to the formula in this nickel trading system regulation.

"Wait for a small formula adjustment," said Prihadi, without explaining the formula adjustment expected by the smelter business.

Meanwhile, the nickel metal HPM listed in Permen ESDM No. 11/2020 is the floor price that miners and smelters must obey. Even if the transaction price is lower than the HPM in a certain period or because there is a penalty for impurity minerals, the sale can be made under the HPM by a maximum difference of 3%.

To ensure the application of HPM in the nickel trade system, the government formed a supervisory working team. The Coordinating Minister for Maritime Affairs and Investment (Menko Marves) Luhut Binsar Pandjaitan issued the Decree of the Coordinating Minister for Marves Number 108 of 2020, on August 13, 2020.

The regulation stated that the working team carried out the technical task of supervising the sale and purchase of nickel ore between mining businesses and smelters. There are seven scopes of the work team.

Menurut Prihadi, belum terealisasinya aturan tersebut terjadi karena pelaku usaha masih mengkaji dan melakukan sejumlah pertimbangan. "Harap lupakan pencapaian periode Maret sampai dengan Agustus 2020, ini karena semua pihak masih belajar dan mengukur kekuatan masing-masing," jelas dia.

Namun, AP3I belum secara tegas menjamin para pelaku usaha smelter bisa segera menerapkan HPM sebagai acuan transaksi bijih nikel, meski pemerintah telah mem-bentuk tim pengawas. Sebab, pelaku usaha smelter masih berharap adanya penye-suaian formula pada pengaturan tata niaga nikel ini.

"Tunggu adanya penyesuaian kecil formula," kata Prihadi tanpa menjelaskan penyesuaian formula yang diharapkan pelaku usaha smelter.

Adapun, HPM logam nikel yang tercantum dalam Permen ESDM No. 11/2020 merupakan harga batas bawah (floor price) yang harus ditaati oleh penambang dan smelter. Sekalipun harga transaksi lebih rendah dari HPM pada periode tertentu atau karena ada penalti atas mineral pengotor (impurties), penjualan dapat dilakukan di bawah HPM dengan selisih paling tinggi 3%.

Untuk memastikan berlakunya HPM pada tata niaga nikel, pemerintah membentuk tim kerja pengawasan. Menteri Koor-dinator Bidang Kemaritiman dan Investasi (Menko Marves) Luhut Binsar Pandjaitan menerbitkan Keputusan Menko Marves Nomor 108 tahun 2020, pada 13 Agustus 2020.

Beleid tersebut menyebutkan, tim kerja tersebut melakukan tugas teknis peng-awasan terhadap transaksi jual beli bijih nikel antara pelaku usaha pertambangan dan smelter. Ada tujuh cakupan tugas dari tim kerja tersebut.

IMA-Daily Update Page 22

First, ensure that the price used in buying/selling nickel ore is in accordance with the HPM. Second, ensuring the ore being traded is ore mined from the IUP area which has Clean and Clear status and is in accordance with the agreed contract.

Third, eradicating traders' activities that are detrimental to mining business actors and end users of nickel ore. Fourth, ensure that the surveyor company used by the seller and buyer of ore has been registered with the Ministry/Institution and has carried out its business activities in accordance with applicable standards and regulations.

Fifth, ensure that mining companies apply the principles of good mining management in their IUP areas in accordance with applicable regulations, and ensure processing and refining companies carry out occupational health and safety management, environmental management, and sound trade.

Sixth, monitoring compliance reports on the Minister of EMR Regulation Number 11 of 2020 which is submitted quarterly by mining business actors and processing and refining business actors. Seventh, provide recommendations to the competent Ministries and Institutions to impose sanctions on violating parties.

Referring to the attachment of the regulation, the working team steering consists of the heads of ministries and related institutions. Namely the Coordinating Minister for Marves, the Minister of EMR, the Minister of Industry, the Minister of Trade, the Minister of Finance, and the Head of the Investment Coordinating Board (BKPM).

Meanwhile, the head of the implementing work team is the Deputy for Investment and Mining Coordination at the Coordinating Ministry for Marves.

Pertama, memastikan harga yang digunakan dalam transaksi jual/beli bijih nikel sesuai dengan HPM. Kedua, memastikan bijih yang diperjualbelikan merupakan bijih yang ditambang dari wilayah IUP yang telah berstatus Clean and Clear serta sesuai dengan kontrak yang disepakati.

Ketiga, memberantas aktivitas traders yang merugikan bagi pelaku usaha pertambangan dan pengguna akhir bijih nikel. Keempat, memastikan perusahaan surveyor yang digunakan oleh pihak penjual dan pembeli bijih telah terdaftar di Kementerian/ Lembaga, serta telah melaksanakan kegiatan usahanya sesuai standar dan ketentuan yang berlaku.

Kelima, memastikan perusahaan pertam-bangan menerapkan prinsip-prinsip penge-lolaan tambang yang baik dalam wilayah IUP-nya sesuai dengan ketentuan yang berlaku, serta memastikan perusahaan pengolahan dan pemurnian melaksanakan manajemen kesehatan dan keselamatan kerja, pengelolaan lingkungan, serta perda-gangan yang baik.

Keenam, memantau laporan kepatuhan atas Peraturan Menteri ESDM Nomor 11 Tahun 2020 yang disampaikan secara triwulanan oleh pelaku usaha pertambangan dan pelaku usaha pengolahan dan pemurnian. Ketujuh, memberikan rekomendasi kepada Kemen-terian dan Lembaga berwenang untuk memberikan sanksi terhadap pihak yang melanggar.

Merujuk pada lampiran beleid tersebut, pengarah tim kerja terdiri dari pimpinan kementerian dan lembaga terkait. Yakni Menko Marves, Menteri ESDM, Menteri Perindustrian, Menteri Perdagangan, Menteri Keuangan, dan Kepala Badan Koordinasi Penanaman Modal (BKPM).

Sedangkan ketua tim kerja pelaksana adalah Deputi Bidang Koordinasi Investasi dan Pertambangan Kemenko Marves.

IMA-Daily Update Page 23

The Deputy Chair of this team consists of the Director General (Dirjen) of Minerba, Ministry of EMR; Director General of Metal, Machinery, Transportation Equipment and Electronics at the Ministry of Industry; Director General of Resilience, Territorial Affairs, and International Industry Access to the Ministry of Industry; Director General of consumer protection and trade order of the Ministry of Trade; Director General of Customs and Excise, Ministry of Finance; and Deputy for Investment Promotion at BKPM.

Meanwhile, the members consist of the Coordinating Ministry for Marves (10 representatives), the Ministry of EMR (10 rep.), the Ministry of Industry (6 rep.), the Ministry of Trade (3 rep.), the Ministry of Finance (4 rep.) and the BKPM (6 rep.).

Wakil Ketua tim ini terdiri dari Direktur

Jenderal (Dirjen) Minerba Kementerian

ESDM; Dirjen Industri Logam, Mesin, Alat

Transportasi dan Elektronika Kemenperin;

Dirjen Ketahanan, perwilayahan, dan akses

industri internasional Kemenperin; Dirjen

Perlindungan konsumen dan tertib niaga

Kemendag; Dirjen Bea dan Cukai

Kemenkeu; dan Deputi Bidang Promosi

penanaman modal BKPM.

Sedangkan anggotanya terdiri dari pihak

Kemenko Marves (10 perwakilan),

Kementerian ESDM (10 perwakilan),

Kemenperin (6 perwakilan), Kementerian

perdagangan (3 perwakilan), Kemenkeu (4

perwakilan) dan BKPM (6 perwakilan).

Lonely Sentiment Bro! Coal Can Only Rise Slightly Tri Putra, CNBC Indonesia

NEWCASTLE thermal coal prices are

starting to show signs of increasing after subsiding to their lowest level in 4 years. However, the price of this commodity is still lacking positive catalysts, so that the price increase tends to reflect only technical factors.

On Friday (14/8/2020) the price of the most active coal futures contract on the New Castle market closed up 0.6% to US$ 50.9/ton. In previous trading, coal prices had touched their lowest level since April 14 2016 at US$ 50/ton.

The Coronavirus Disease 2019 (Covid-19) pandemic has not only decreased the demand for coal but also has an impact on its market share. The outbreak of the epidemic...

Sepi Sentimen Bro! Batu Bara Hanya Mampu Naik Tipis

Tri Putra, CNBC Indonesia

HARGA batu bara termal Newcastle mulai

menunjukkan tanda kenaikan setelah ambles ke level terendah dalam 4 tahun terakhir. Namun harga komoditas ini masih sepi katalis positif sehingga peningkatan harga cenderung mencerminkan faktor teknikalnya saja.

Pada Jumat (14/8/2020) harga kontrak berjangka teraktif batu bara di pasar New Castle ditutup menguat 0,6% ke US$ 50,9/ton. Pada perdagangan sebelumnya, harga batu bara sempat menyentuh level terendah sejak 14 April 2016 di US$ 50/ton.

Pandemi Coronavirus Disease 2019 (Covid-19) tak hanya membuat permintaan batu bara turun tetapi juga berdampak pada pangsa pasarnya. Merebaknya wabah...

IMA-Daily Update Page 24

The outbreak of the epidemic is used as a

momentum to switch to primary energy

sources that are more environmentally

friendly by many countries, especially from

Europe.

In the first half of this year, demand for

global electricity is expected to decline by

3%. Despite the decline, coal plants still

supplied 33% of the world's electricity

during this period.

Furthermore, bad news for the coal market

came from the world's main consumer,

namely China, which recorded an increase

in stocks. China's domestic coal prices,

namely Qinhuangdao FOB, fell 1.7% for the

week to RMB 562/ton on Friday.

Prices fell after coal supplies at

Qinhuangdao, the main trans-shipping port

in North China, increased 14% from 5.09

million tonnes at the end of the previous

week to 5.78 million tonnes on Aug.7.

The impact of China's coal import

restrictions can be seen from China's coal

import data as of July, which fell 21%

compared to the same month last year to

26.1 million tonnes, according to data from

the General Administration of Customs (7

August).

Not only in Asia, the weakening of the coal

market also occurred in Latin America.

Colombia, where coal is the second largest

export commodity, saw a decline in

exports of the black metal. Reuters reports

that exports of Cerrejo, one of their coal

giants, in the first half of 2020 fell to 9.5

million tonnes or the lowest in 18 years.

CNBC INDONESIA RESEARCH TEAM (trp/trp)

Merebaknya wabah dijadikan sebagai momentum untuk beralih ke sumber energi primer yang lebih ramah ling-kungan oleh banyak negara terutama dari Eropa.

Pada paruh pertama tahun ini, permintaan terhadap listrik global diperkirakan meng-alami penurunan sebesar 3%. Meskipun mengalami penurunan, pembangkit batu bara masih memasok 33% listrik dunia selama periode tersebut.

Selanjutnya kabar buruk bagi pasar batu bara datang dari konsumen utama dunia, yakni China, yang mencatat kenaikan stok. Harga batu bara domestik China, yakni Qinhuangdao FOB, turun 1,7% untuk minggu ini menjadi RMB 562/ton pada Jumat.

Harga turun setelah persediaan batu bara di Qinhuangdao, pelabuhan trans-pengi-riman utama di China Utara, meningkat 14% dari 5,09 juta ton pada akhir minggu sebelumnya menjadi 5,78 juta ton pada 7 Agustus.

Dampak pembatasan impor batu bara China terlihat dari data impor batu bara China per Juli yang merosot 21% di-bandingkan dengan bulan yang sama tahun lalu menjadi 26,1 juta ton, menurut data Administrasi Umum Kepabeanan (7 Agustus).

Tak hanya di Asia, pelemahan pasar batu bara juga terjadi di Amerika Latin. Kolombia, di mana batu bara menjadi komoditas ekspor terbesar kedua, men-catat penurunan ekspor logam hitam itu. Reuters melaporkan bahwa ekspor Cerrejo, salah satu raksasa batu bara mereka pada semester I-2020 anjlok ke 9,5 juta ton atau yang terendah dalam 18 tahun. TIM RISET CNBC INDONESIA (trp/trp)

IMA-Daily Update Page 25

DMCI Mining reports increased shipments By James A. Loyola

DMCI Mining Corporation reported that it shipped 853,197 wet metric tons (WMT) of nickel ore from January to June, a 25 percent jump from 681,360 WMT compared to the same period last year.

In a disclosure, the firm said the marked increase was due to the resumption of its nickel production in Zambales through subsidiary Zambales Diversified Metals Corporation (ZDMC).

Accounting for 24 percent of the total shipment, ZDMC sold 202,440 WMT in the first half of the year. The company made no shipments during the same period in 2019.

Berong Nickel Corporation (BNC)—DMCI Mining’s nickel asset in Palawan—exported 650,757 WMT of nickel ore, a 4 percent decline year-on-year from 681,360 WMT.

In the second quarter alone, BNC and ZDMC shipped 321,966 WMT and 101,140 WMT, respectively.

“The Indonesian ban on nickel ore exports and easing of COVID-19 containment measures in May allowed us to sustain our production and shipments,” explained DMCI Mining president Cesar F. Simbulan.

He added that, “We also benefited from shifting market demand. Nine of our 16 shipments to China were for low-grade nickel ore, which was previously unsellable.”

The demand for low-grade nickel was driven by China’s sustained steel production during the first half of the year.

In addition to the Indonesian nickel ban, the coronavirus pandemic-induced trade restrictions pushed Chinese buyers to shift to low-grade nickel to support its raw material requirements. Nickel is primarily used for stainless steel production but demand for the metal is projected to increase in the coming years on the back of higher battery production for electric vehicles and renewable energy storage.

BHP seeking thermal coal exit, profit slips amid virus hit By Nick Toscano

Business reporter for The Age and Sydney Morning Herald

THE NATION's largest miner, BHP, has confirmed it is seeking to exit thermal coal mining

globally and some of its metallurgical coal mines in Queensland in a bid to remove risk from its portfolio.

It will also seek to sell its 50 per cent stake in the Bass Strait oil and gas fields off the Victorian coast after its joint-venture partner ExxonMobil flagged it was searching for a buyer.

IMA-Daily Update Page 26

The announcements were made as BHP reavealed an underlying profit of $US9.1 billion ($12.6 billion) for the financial year on the back of sky-high prices for the steel-making raw material iron ore. But the profit fell short of market analysts' expectations of $US9.4 billion. Shareholder dividends for the full year of $US1.20 were also weaker than the $US1.23 expected by analysts.

BHP chief executive Mike Henry said the full-year results reflected the "strength, resilience and quality" of its portfolio and people.

"In a year marked by the challenges of the global COVID-19 pandemic, social unrest and commodity price volatility, we were safer, more reliable and lower-cost," Mr Henry said.

After months of signalling it is open to the prospect of exiting thermal coal – the coal used to generate energy – BHP on Tuesday said it was looking at options to exit its thermal coal assets at Mt Arthur in NSW and the Cerrejon project in Colombia, which together account for about 3 per cent of revenue. It also said it was looking to exit its BHP Mitsui Coal joint venture, which mines coking coal – used for steel production – in Queensland.

"We are moving to concentrate our coal portfolio on high-quality coking coals, with greatest potential upside for quality premiums as steel makers seek to improve blast-furnace utilisation and reduce emissions intensity," Mr Henry said.

Thermal coal is the most carbon-intensive energy source and the focus of rising investor pressure in response to concerns surrounding its contribution to global warming. BHP's rival Rio Tinto, the world's second largest miner, has already removed all exposure to thermal coal while Anglo-American earlier this year said it intended to offload its thermal coal assets in the coming years.

Mr Henry said BHP would seek to exit the coal assets through either a demerger or a trade sale. He said BHP would seek to increase its exposure to "future-facing" commodities, including copper and nickel – ingredients required in the manufacture of green-energy technologies.

Morgans analyst Adrian Prendergast said the decision to seek a buyer for its Queensland coking coal assets came as a "surprise" but appeared part of a change in focus to maximise quality in its portfolio given the market conditions.

BHP's biggest earner, iron ore, accounts for 65 per cent of its earnings. The price of the commodity has defied repeated predictions it is overdue for a fall and recently surged above $US120 a tonne driven by robust demand from Chinese steel mills and softer output from other exporters such as Brazil’s Vale due to COVID-19 disruptions.

Iron ore is also Australia's most valuable export, this year becoming the first-ever to crack $100 billion in export value.

Profit from some of BHP's commodities such as copper, petroleum and coal have been damaged by various impacts of COVID-19.

In early afternoon trade, BHP shares are down 0.5 per cent to $39.68.

IMA-Daily Update Page 27

Vietnam coal imports jump 50 pct By Anh Minh

VIETNAM has spent around $2.6 billion on importing 36.5 million tons of coal in the first

seven months of this year, up 50 percent in volume year-on-year.

In July alone, the country imported five million tons of the product worth $294 million, mostly from Indonesia, Russia and China, according to Vietnam Customs.

Vietnam also exported more than 410,800 tons of coal worth $57 million between January and July.

The country has been importing increasing amounts of coal in recent years as demand from thermal power plants increases and domestic production is mired in difficulties, requiring deeper pits to reach the mineral. It became a coal importer from being a net exporter just five years ago.

Though the government has been trying to reduce its reliance on coal, encouraging solar and wind power plants, thermal power plants accounted for 36.1 percent of the electricity generated last year, according to the Vietnam Energy Association.

Vietnam is expected to import 12 million tons of coal this year, 30 million tons in 2025 and 50 million tons in 2030 to fuel its thermal power plants, senior officials of the state-owned coal mining group Vinacomin said earlier this year.

Iron ore edges higher on China demand optimism, stainless steel

shines By Enrico Dela Cruz

IRON ore futures inched higher on Monday, with the Dalian benchmark contract extending

gains into a third session on upbeat demand prospects in top steel producer China, although rising supply tempered investors' optimism.

Chinese stainless steel futures took the spotlight, however, rising as much as 4.2% as prices of key ingredient nickel on the London Metal Exchange headed back towards their highest in nearly nine months. The most-traded January 2021 iron ore on the Dalian Commodity Exchange ended the morning session up 0.6% at 836.50 yuan ($120.52) a tonne.

The front-month September contract on the Singapore Exchange rose as much as 1.2% to $117.25 a tonne. Dalian iron ore is on track for its sixth straight monthly gain while spot prices of the steelmaking ingredient in China hover around a 13-month high, underpinned by Beijing's stimulus programme for the coronavirus-hit economy.

IMA-Daily Update Page 28

"With the government looking to speed up infrastructure investment in the second half of the year, this should see steel output remain strong," said Daniel Hynes, senior commodity strategist at ANZ.

But rising supply kept iron ore's gains in check, with shipments from Australia's Port Hedland hitting 43.6 million tonnes in July, the highest ever for the month, he said in a note. Daily iron ore shipments from Brazil rose to 1.64 million tonnes in the first five days of August, up from 1.48 million tonnes in the 23 business days of July, Hynes said.

Stainless steel on the Shanghai Futures Exchange closed the morning session up 3.4% at 14,665 yuan a tonne.

FUNDAMENTALS

* The Dalian exchange has included Yandi Fines and Karara Concentrate as new deliverable brands for its benchmark iron ore futures.

* Shanghai construction steel rebar climbed 1.1%, while hot-rolled coil advanced 0.6%.

* Dalian coking coal slipped 0.4% but coke gained 0.6%. (Reporting by Enrico dela Cruz; Editing by Subhranshu Sahu)

Lynas posts 2020 loss, raises funds for plant in Australia Cecilia Jamasmie

RARE earths miner Lynas Corp (ASX: LYC) posted on Monday a smaller-than-expected

annual loss and outlined plans to raise A$425 million (around $307m) to fund construction of a new ore processing plant in Australia.

The world’s biggest rare earths miner outside China said loss after tax came in at A$19.4 million for the year ended June 30, compared with a profit of A$83.1 million a year earlier. This was better than analysts’ expectations of a loss of A$27.6 million, according to Reuters.

The miner attributed the figures to a temporary coronavirus-related suspension of its Malaysian processing plant and lower market prices.

Lynas expects to process low-level radioactive material from its Mt Weld mine at a new cracking and leaching plant in Kalgoorlie, Western Australia. The plan is to shift part of its operations off its Malaysian plant where it has faced stiff opposition over environmental concerns.

The Sydney-based company was able to renew last year the operating license for its Malaysian processing plant for six months, subject to conditions that included identifying a site for a permanent facility to store its low-level radioactive waste.

Lynas was also asked to put forth a plan to set up a cracking and leaching facility overseas within four years of the license renewal.

IMA-Daily Update Page 29

The company said first-step concentrate processing at the Kalgoorlie plant is expected in 2021 and the plan is for the plant to be completed in late 2022 or early 2023.

Earlier this month, Malaysian authorities cleared the way for Lynas to dispose of radioactive residue collected from its purification processes and stockpiled near the local plant. This approval removes uncertainty around the company’s future in the Asian nation. Its operating license now expires in 2023.

Pentagon’s backing

The company, which controls just over 10% of the global rare earths market, secured in July US government funding to design a A$50m ($36m) processing plant in Texas.

The contract came amid growing concerns in Washington that China could use its dominance of the rare earths supply chain to pressure US arms suppliers. Beijing threatened in July to impose sanctions on American aerospace, defense, arms and security provider Lockheed Martin.

The facility would be the world’s only large-scale producer of separated medium and heavy rare earth products outside of China, which currently accounts for 70% of global production.

China also controls more than 60% of a $14 billion global market for materials used in magnets and motors that power phones, wind turbines, electric vehicles and military devices.

Super Pit future secured by major extension Salomae Haselgrove

THE ICONIC Super Pit mine in Kalgoorlie, Western Australia is set to continue producing

gold for at least another 15 years after an expansion of its resource.

Kalgoorlie Consolidated Gold Mines (KCGM) completed a review of the future of the Super Pit, discovering a mineral resource of 19 million ounces.

This includes a 2.2 million-ounce resource below the Super Pit, which is the first underground resource in the modern era.

KCGM said this result secures the future of the famous mine, with the potential to extend the 19-million-ounce gold resource further with significant exploration potential in and around the site.

At the current gold prices of $2700 per ounce, this gives the Super Pit’s gold in the ground a market value of $54 billion.

Following this update from KCGM, joint owners Northern Star and Saracen Mineral Holdings have set their 2021 financial year guidances to 940,000 to 1.06 million ounces and 600,000 to 640,000 ounces respectively.

IMA-Daily Update Page 30

Northern Star’s production is forecast to rise to 1.15 million ounces in the 2022 financial year and 1.25 million ounces in the 2023 financial year, with its total reserves rising by 102 per cent to 5.5 million ounces with the inclusion of KCGM.

“KCGM will play a key role in driving Northern Star’s annual production rate to 1.25 million ounces and beyond over the next few years,” Northern Star executive chair Bill Beament said.

“The review shows the outlook for KCGM is excellent on every level. The project is set to generate strong production growth underpinned by an extensive inventory in a tier-1 location.”

Saracen has also updated its group reserve and group resources accordingly, to 190 million tonnes at 1.4 grams per tonne for 8.6 million ounces and 320 million tonnes at 1.7 grams per tonne for 17 million ounces respectively.

Managing director Raleigh Finlayson said this puts the company on track to continue growing production and expanding its inventory.

“As in the past, our next round of substantial growth will come totally from within Western Australia, ensuring our future-proofing strategy continues to benefit from the certainty which comes from operating solely in a tier-1 location,” Finlayson said.

“We are in a superb position given the strong gold price, our growing production profile (and) our outstanding working relationship with Northern Star Resources at the world-class KCGM project.”

KCGM general manager, operations Kous Kirsten said the results were not just great news for KCGM, Northern Star and Saracen, but also for the township of Kalgoorlie-Boulder and wider Western Australia.

“This is a great day for Kalgoorlie and all the workers and businesses which depend on KCGM for their livelihoods,” Kirsten said.

“The review shows that after 125 years of mining, Kalgoorlie’s world-renowned Golden Mile and the Super Pit project it houses are still world-class.”

Thermal coal, coking coal imports dip 31% to 37 million tonnes in

April to July The import of thermal coal declined by 30 per cent to 23.19 MT, and coking coal shipment

dropped 32.26 per cent to 13.51 MT in the same period.

THE IMPORT of thermal and coking coal at India's 12 major ports has fallen 31 per cent to

36.7 million tonnes (MT) between April and July 2020 over the same period a year ago, according to the Indian Ports' Association (IPA).

It is for the fourth straight month that coal volumes have declined at this 12 major ports that are controlled by the Centre.

IMA-Daily Update Page 31

The import of thermal coal declined by 30 per cent to 23.19 MT, and coking coal shipment dropped 32.26 per cent to 13.51 MT in the same period.

Earlier, these 12 ports had handled 33.11 MT of thermal coal and 13.51 of coking coal from April to July period of the previous financial year.

However, thermal and coking coal handling saw a decline of 30.83 per cent at 36.7 MT, this year, as per the IPA data.

Thermal coal is the mainstay of India's energy programme as 70 per cent of power generation is dependent on the dry fuel. Whereas, coking coal is used mainly for steel making.

India is the third-largest producer of coal after China and the US, and has 299 billion tonnes of resources and 123 billion tonnes of proven reserves, which may last for over 100 years.

These 12 major ports had handled 705 MT of cargo in the last financial year. These ports had together handled 236.01 MT of cargo during April-July 2018-19, the ports body said.

Ports like Chennai, Cochin and Kamrajar saw their cargo volumes nosedive over 30 per cent during April-July, while JNPT and Kolkata suffered a drop of over 20 per cent.

India has 12 major ports under the control of the central government -- Deendayal (erstwhile Kandla), Mumbai, JNPT, Mormugao, New Mangalore, Cochin, Chennai, Kamarajar (earlier Ennore), V O Chidambarnar, Visakhapatnam, Paradip and Kolkata (including Haldia).

These ports handle about 61 per cent of the country's total cargo traffic. These ports handled 705 MT of cargo last fiscal.

While Chennai port saw 32.53 per cent decline in cargo handling to 11.08 MT, Kamarajar (Ennore) port suffered a drop of 35.64 per cent to 7 MT in April-July, as per IPA data.

Cochin Port saw a dip of 32.78 per cent to 7.76 MT during the period.

Cargo handling at JNPT port slipped 27.69 per cent to 16.94 MT, while the same at Kolkata declined 26.09 per cent to 16.05 MT. Mumbai port logged a fall of 19.79 per cent to 15.85 MT.

In the wake of the COVID-19 outbreak, sharp declines were witnessed in handling of containers and POL (petroleum, oil and lubricant) among other commodities like coal. (With PTI inputs)