PH nickel sector sees further increase in global demand

By: Philippine Resources July 21, 2023

Nickel demand is expected to further increase, driven by the shift to smart cities and clean energy, but additional investments are needed to help the Philippine nickel industry take advantage of the global demand, the Philippine Nickel Industry Association (PNIA) said.

In a statement, the PNIA said raw nickel ore is not only a critical component of electric vehicle (EV) batteries but is also processed to create stainless steel, which is used in the development of megacities and renewable energy technology.

“Clean energy and smart cities cannot be realized without nickel as nickel has cross-cutting use in the development and manufacturing of various clean energy technologies, such as electric vehicles (EVs), solar panels, power grid systems, wind turbines, and new technologies, such as hydrogen-based energy,” PNIA president Dante Bravo said.

The total current value of investments in the global EV industry alone already amounts to USD300 billion and might even reach as high as USD1 trillion within the next five years, he said.

Demand for nickel will mainly be driven by China, he said, adding that the rollout of an infrastructure investment plan in the country would further boost demand for stainless steel.

Bravo, however, said to take advantage of this growing global demand, the Philippines needs to attract additional investments that would enable the exploration, processing, and further development of the country’s nickel reserves.

At present, the Philippines and Indonesia have substantial reserves to meet this global nickel demand.

“Currently, we only have 34 nickel mines, and production is typically influenced by global nickel supply and price. Production in 2022 is at 29.2 million dry metric tons. Meanwhile, Q1 (first quarter) 2023 production is at 3.9 million dry metric tons," he said. "We can expect significant growth in production if we start to attract investments in mining exploration and there is a clear viable track towards value-added processing.”

Bravo said the Philippines only has two successfully operating nickel processing plants.

To be considered viable, he said, a processing plant needs at least 100 million tons of raw nickel ore, hence, the need to further conduct exploration and feasibility research to determine nickel reserves.

“The industry needs a lot of support from the government, be more open to exploration, and make it easy for foreign investors to come in. We need to map out what we have and what we don’t have. Currently, we have the capability to mine nickel, but there is a whole value chain in value-added processing leading to the manufacturing of battery that needs to be enabled, guided by the right government policies and programs," Bravo said.

To accelerate the growth of mining and to shift towards value-added processing, PNIA is currently hosting policy discussions with government counterparts and stakeholders under its Nickel Initiative program.

Bravo said PNIA has so far conducted three roundtable discussions with different government agencies to make the local mining industry more competitive, attract more investments, and promote responsible mining.

“The discussions have been productive so far and we look forward to zooming in on action points that raise the competitiveness of the Philippine nickel mining sector and make it a veritable driver of responsible mining and inclusive economic development,” he said.

The roundtable discussions are set to be completed in August during the conduct of the Nickel Initiative 2023 Business Conference, which will be attended by government, private sector, and other non-government nickel industry stakeholders.

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