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Nickel

16 April 2021
Credit by Indonesia Soken
Serial : Migas, Sumber Daya Alam Baru dan terbarukan

The nickel price was corrected to its lowest level in more than two weeks, as reported by Bloomberg on Monday (19/4/2021), the nickel price on the Shanghai stock exchange, China, was corrected by 2.2 percent to US $ 16,010 per metric ton. The note is nickel’s lowest position since last April 1. Meanwhile, nickel price on the London Metal Exchange (LME) was observed to slightly decrease 0.01 percent to the level of US $ 16,363 per metric ton. On a year to date (ytd) basis, the price of this commodity has corrected by 1.50 percent.

The price corrections currently being experienced have made nickel one of the weakest performing commodities so far, however, there is still plenty of room for a stronger nickel price in 2021. During the first semester of 2021, APNI predicts nickel prices will be at the level of US $ 14,000 to US $ 18,000 per ton. Meanwhile, for 2021, the price range for these commodities will be in the range of US $ 13,000 to US $ 21,000 per ton.

In Indonesia, nickel is one of the most strategic commodities owned by Indonesia, including the top 3 commodities whose control is significant enough to be controlled by Indonesia in the global market. The three commodities are thermal coal, nickel and tin. For nickel, Indonesia controls 27% of world supply. Nickel production includes upstream nickel ore products of 50 million tons per year, as well as downstream products such as FeNi, NPI, Matte as much as 907 thousand tons. In addition, nickel is classified as a strategic metal commodity. Indonesia itself was the 6th largest nickel exporter out of the 10 largest nickel producing countries in the world in 2016. The potential for nickel reserves is mostly found in Southeast Sulawesi, Central Sulawesi and North Maluku.

Amid the decline in world nickel prices, Indonesia actually has a positive trend regarding the nickel business, namely Indonesia is considered to be the largest producer of lithium batteries and electric vehicles in the world, in line with the large supply of nickel for manufacturing lithium batteries, which are the main ingredients for the development of electric vehicles (EV). The amount of nickel supply is reflected based on data from the Ministry of Energy and Mineral Resources (ESDM), in 2017, Indonesia was able to produce 2.12 million tonnes of nickel pig iron (NPI) and 482,400 tonnes of ferronickel (FeNi) in 2017. The government seriously responded to the trend. This is positive by issuing Presidential Regulation (Perpres) Number 55 of 2019 concerning the Acceleration of the Battery Electric Vehicle Program for Road Transportation.

The Ministry of Energy and Mineral Resources (ESDM) noted that the proven reserves for the national nickel commodity amounted to 698 million tons, and could only guarantee the supply of nickel ore for refining facilities for 7-8 years. The Indonesian nickel industry also continues to increase in economic value due to downstreaming. Although nickel ore sales have decreased since ore exports were banned (January 1, 2020), the total economic value of the Indonesian nickel industry has increased by 4-5 times in the downstream sector.

To sum up, Indonesia has a great future regarding the giant production of nickel in the development of the battery industry and electric cars, which is in line with the rapid trend of electric vehicles in the world. This shows that nickel production has a bright future to invest in, remembering the nickel market is increasingly defined by the car manufacturers working in electric vehicles. This Nickel business opportunity is something that cannot be wasted. We, Indonesia Research Institute will help investors to conduct further research on this business opportunity. Indonesia Research Institute Japan offers all services from desk research, in-depth interviews, to market surveys for a better understanding of the topic that wants to be understood on how Nickel’s business works.

 

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    Authored by : Fitri Aulia | 22 December 2020

    Recent Property Development

    The Covid-19 pandemic has dealt a quite severe blow to the property business sector in 2020. During the PSBB period, business activities were very sluggish and it can be said that some business actors suffered severe losses.

    However, entering the new normal period, the economic activity in several sectors including property has begun to revive from the previous period. The role of the government triggers the revival of Indonesia’s property business activities.

     Government Stimulus

    The assistance provided by the government is in the form of subsidies or incentives for interest subsidies to debtors of public housing credit (KPR), which is contained in the Minister of Finance Regulation (PMK) Number 138 / PMK.05 / 2020 and amendments to PMK 85 / PMK.05 / 2020 regarding the guidelines for providing interest subsidies in the effort to implement the National Economic Recovery program.

    In early March 2020, the Government decided to increase the allocation of housing financing assistance by IDR 1.5 trillion for Low-Income Communities (MBR). This was stated by the Director General of Infrastructure Financing of the Ministry of Public Works and Public Housing (PUPR) Eko Djoeli Heripoerwanto in a webinar, Wednesday (29/7/2020).

    In addition, the Government also has Bank BTN as their partner-collaboration to implement their OMH Program aimed at Low-Income Communities (MBR) with low interest rates and low installments for the purchase of a prosperous tread house and a welfare apartment.

    Bank BTN noted, in 2015 they have provided housing financing assistance totaling 474,099 units. Then in 2016 as many as 595,540 units, in 2017 to 666,806 units, in 2018 to 755,093 units, and in 2019 to 735,749 units.

    As of September 2020, BTN has provided home ownership credit support (KPR) of 93,448 units which cost as much as Rp. 15.6 trillion. These support provided by BTN is significant for the survival of the business property sector.

    BTN commitment on supporting business property has not slackened. In fact, during the pandemic, BTN continuously provides support for the government program.The distribution of subsidized KPR is still a mainstay of BTN for the One Million Houses program.

     

    Source : Bank BTN (visit : https://www.btn.co.id/id/Conventional/Product-Links/Produk-BTN/Kredit-Konsumer/Pinjaman-Bangunan/KPR-BTN-Subsidi)

    Positive Trend in Q3  2020

    There is a positive trend during Q3 2020 after it drastically dropped earlier in the year, indicates there is potential for the revival of Commercial Property Demand in Q4 2020 and the next Q1 2021.

    Source : Bank Indonesia

    Hotels and convention halls are two sectors whose demand has risen quite drastically in the Q3 after falling badly in the previous quarter. This demonstrates positive potential for its development in the future. Meanwhile, the demand of apartment remains low and still struggles to revive until now.

    Growth of Commercial Property Demand in Jabodetabek

    Overall in Jabodetabek, the commercial property sector also experienced a positive increase during Q3 2020.

    In Jakarta, all commercial property demands show positivism with hotels being the most prominent in their development at Q3 2020. After previously shows a negative number, the total index in Q3 has at least increased to be positive.

    Source : Bank Indonesia

     Meanwhile, the growth in the total commercial property index jumped drastically in Bogor, Depok and Bekasi. Same case with Jakarta, its hotel sector are also the most prominent in reviving, at least in the Q3 2020.

    Source : Bank Indonesia

    As we can see on charts above, the hotel segment shows a great improvement in demand. This was driven by various kinds of promotions offered by hotels to adapt in this situation such as providing huge discount, staycation packages, working from hotels offer, and wedding reception packages.

    Why Hotels?

    As Indonesia gradually eases lockdown restrictions, the hotel occupancy rates across the country including Jakarta, have slowly started to pick up. However this is not without several efforts and sacrifices driven by people in the hotels sector to improve and revive the hospitality business sector in Indonesia.

    To get through this hard times, efficiency and innovation are the main keys. Therefore, there are several trends created specifically to adapt to this era. Hotels competing with each other to offer a flood of discounts. To further intensify its sales strategy, there are several e-commerce platforms that is becoming a  great place to advertise rooms and staycation packages, such as Traveloka. The Buy Now Stay Later also sticks to this trend.

    Hotels discounts on Traveloka (Source : Traveloka)

    Another new trend is the Work From Hotel (WFH). As you might know, the abbreviation of WFH was initially stands for Work From Home. To connect the dots, Working From Hotel then exist and created because there are more and more office workers are getting bored with the atmosphere of their house and desperate to look for a new atmosphere. It’s a trend where hotels prepare rooms, complete with equipment and facilities to work (e.g : Wi-Fi , stationer, and free printing facilities,etc).

    Source : Instagram @harrisfxsudirman and @arunasenggigi

    During the transitional PSBB period, indoor wedding receptions are allowed to be held again after previously was banned temporarily due to the massive increase of the Covid-19 spread. This becomes the opportunity that triggers the revival for the hotel business.

    However, this permission is also accompanied by the requirement to fulfill and comply with the health protocols made by the government. These includes the limitation of attendees to a maximum of 25 percent of normal capacity. Then, the seating distance for visitors is set at least 1.5 meters. Visitors are also prohibited from passing by or changing seats. The eating and drinking utensils must be sterilized, while the serving of food is prohibited from using a buffet. Last but not least, the wedding staffs are required to wear a mask, face shield and gloves.

    One of the breakthrough in this trend was the make of  “Virtual Wedding” ever since June 2020. As this was the case held by The Sunan Hotel Solo, which offer a virtual wedding service package for 44.5 million. The event is only attended by the couple and their family members, meanwhile guests are able to attend the wedding virtually through various platforms such as Zoom, YouTube, Facebook and Instagram, while enjoying food sent by the hotel to their residences.

                                                                                                              Source: The Sunan Hotels Solo

    Finally, we might conclude that the property business in Indonesia has the potential to develop more despite the massive impact it has taken from pandemic outburst. Combining the stakeholders effort and the government’s support to stimulate this sector are expected to help revive the business sector in the future.

     

    References

    Bank Indonesia. (2020). Perkembangan Properti Komersial (PPKOM).

    Kementerian Pekerjaan Umum dan Perumahan Rakyat. (2020, November 3). Tingkatkan Kepemilikan Hunian Layak, Realisasi Program Sejuta Rumah Hingga Akhir Oktober 2020 Capai 601.637 Unit. Retrieved from https://www.pu.go.id/berita/view/18970/tingkatkan-kepemilikan-hunian-layak-realisasi-program-sejuta-rumah-hingga-akhir-oktober-2020-capai-601-637-unit

    Kementerian Pekerjaan Umum dan Perumahan Rakyat . (2020, January 3). Capaian Pembangunan Rumah Tembus 1,25 Juta Unit. Retrieved from https://perumahan.pu.go.id/berita/view/227/capaian-pembangunan-rumah-tembus-1-25-juta-unit

    Kompas. (2020, July 29). Alokasi Tambahan Rp 1,5 Triliun untuk Perumahan Terkait 3 Program. Retrieved from https://properti.kompas.com/read/2020/07/29/191334021/alokasi-tambahan-rp-15-triliun-untuk-perumahan-terkait-3-program?page=all

    BUMN inc. (2020). Target Penyaluran KPR Bank BTN Naik Menjadi 300.000 Unit Per Tahun. Retrieved from http://bumninc.com/target-penyaluran-kpr-bank-btn-naik-menjadi-300-000-unit-per-tahun/?more=2

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