Having observed Indonesia pull in $billions of investments in nickel processing infrastructure, the Philippines has decided it should follow suit. Not surprising really, since Indonesian exports went from $3 billion to $30 billion in just two years as a result of the investment. As reported by Bloomberg, Philippino Environment and Natural Resources, Secretary Antonia Yulo Loyzaga, has said “We don’t want to be a vendor country.” In other words, the Philippines, which the world’s second-biggest nickel supplier after Indonesia, is lining up to do the same.
The Philippines definitely has the potential to grow its nickel sector. Only about 3% of the country’s 9 million hectares with high mineral potential is currently being mined, and there are only two processing facilities in operation. The current stated goal is to add another three. Of course, there are some hurdles. Nickel output dropped 17% last year (Jan–Sept), and there’s still a bit of a hangover from former President Duterte’s early-term crackdown on mining. But things have started opening up again since he lifted the ban on open-pit mining in 2021 and the government expects shipments to increase in 2023 due to the huge demand for nickel.
The government has been careful not to name names but says there’s interest from big players in Canada and Australia looking to invest. I’m not surprised by that. When Indonesia made its play, Chinese companies were quick to get in as major investors and it has paid off handsomely in terms of nickel supply. Western companies would be foolish to let the same thing happen again. Hard to say when we’ll see a decision but, having seen the success of Indonesia, I’d not be surprised if the Philippines were to make its play soon for a great piece of the processing pie.
Anthony Milewski
Chairman, Nickel 28 Capital
