Some analysts consider nickel mining issuers to have an attractive prospect in line with the development of the electric car industry.
Capital Securities Principal Services analyst Chris Apriliony said the increasing demand for nickel due to the development of the electric car industry could make nickel a mainstay commodity in Indonesia.
However, Chris sees nickel reserves in Indonesia need further exploration because currently it tends to be quite small when compared to its production.
Based on Kontan’s records, until July 2020 indonesia’s total nickel ore resource balance reached 11.88 billion tons. While the total nickel metal resources amounted to 174 million tons. Meanwhile, nickel ore reserves balance until July 2020 is recorded at 4.34 billion tons and total nickel metal reserves of 68 million tons. The data was collected from 328 locations in Indonesia.
Furthermore, he said, the presence of nickel mining more widely in Indonesia will also have a positive impact for the population around the mine, this is because usually the area close to the mine has a considerable influence on the economy in the area. “However, it is necessary to pay attention in terms of mine waste disposal and implement good mining practice,” he said, Tuesday (13/10).
With nickel prices again increasing, even penetrating US$ 15,000 per metric ton can drive the performance of nickel companies. So he predicts nickel miner issuers will score a fairly good performance until the close of this year. In order to improve performance, he continued, the company can also look for potential new contracts for nickel sales as well as conduct exploration to find new reserves.
Kiwoom Sekuritas Indonesia analyst Sukarno Alatas said the same thing. He argues that the need for electric battery raw materials will increase nickel demand, so that the prospect of nickel issuers will be attractive in the future.
“The global nickel price is also in an upward trend, this is a positive sentiment for the issuer’s performance. The decline in oil prices is also a positive sentiment due to the efficiency of production costs,” sukarno said.