Nickel output to rise this year

MANILA, Philippines — The country’s nickel production is seen to improve this year with the suspended mines expected to slowly resume their operations.

However, the Philippines is still no way near regaining its largest global nickel producer crown.

According to the latest report from Fitch Solutions Macro Research, a unit of Fitch Group, Philippine nickel mining production will  bounce back this year after consecutive years of decline.

“We expect nickel production in the country to grow by an average 1.7 percent year-on-year,” Fitch said.

Fitch earlier projected that local production would decline by an average of 22.7 percent from 2016 to 2019 as a result of former environment secretary Gina Lopez’s closure and suspension orders on mines.

“But, (Secretary Roy) Cimatu announced that suspended mines would be allowed to resume production once they rectify previous violations of environmental regulations,” Fitch said.

Despite the positive outlook, the local nickel industry still expects mining firms to post lower output this year given  new government regulations.

“We have new guidelines that took effect this year, particularly on the limiting of mine areas. Even if some mines will resume, there is no assurance that production will increase,” Philippine Nickel Industry Association (PNIA) president Dante Bravo told The STAR.

“These mines will correct their violations and will have to operate under the basis of the new guidelines. If we are in status quo, that’s possible but we have new guidelines,” he added.

PNIA earlier said nickel direct shipping ore could decline by as much as 20 percent from the 30 million wet metric tons (MWT) produced last year.

In August 2018, the DENR issued an administrative order which provided new environmental policies that will ensure sustainable environmental conditions at every stage of mining operation, and minimize the disturbed area of a mining project at any given time.

Meanwhile, Fitch said domestic miners SR Metals, Global Ferronickel, Nickel Asia Corp. and CTPCorp. would account for the vast majority of nickel production in the country.

“Nickel Asia, in particular, will remain the driver of nickel production in the Philippines, especially as its Taganito and Cagdianao mines, the largest in the country, have not been hit by the recent closures and suspensions,” it said.

Globally,   nickel production will continue to hold strong this year driven by the ongoing supply recovery in Indonesia despite subdued performance in major markets including Canada, Australia and Russia.