THE huge prospects for the country’s nickel mining industry provide the critical counterweight to the marked decrease in Philippine exports as shown by recent economic data.
Abacus Securities Corp. came out with an industry analysis on November 8 on the nickel mining sector, wherein it discussed regional developments that augur well for the country’s export earnings.
There are two developments, according to Abacus, that support this optimistic view. The first is the increased demand from China for nickel pig iron, its own invention, which is used in place of primary nickel as a raw material for stainless steel. The second is the looming ban in Indonesia for the export of nickel ore. Both developments favor the rise of the country’s nickel-ore exports, and with it the potential incomes of nickel firms, some of which are listed in the stock market.
China, to meet the burgeoning demand of its nickel pig iron plants, would have to source most of its imports from Philippine nickel mines that boast of high-grade nickel ore. Philippine companies could profit immensely from a surge in nickel prices. In fact, Abacus said Marcventures Holdings Inc., a listed nickel firm with its mine site in Surigao del Sur, could earn as much as P1 billion next year.
Marcventures is less than a year old but it best represents the enormous potentials of the nickel mining sector. According to Abacus, in the third quarter alone, the company shipped about 110,000 wet metric tons of high-grade nickel ore worth P300 million. For the fourth quarter, the company having presold its output, is looking at a net income level of P384 million. The said nickel output comes only from a relatively minuscule mining hectarage of 120 hectares, representing just 2.5 percent of the company’s mining concession.
Nickel-ore exports are also seen to register a quantum leap once Indonesia’s ban on the export of the commodity takes effect in 2014. Aside from the Philippines, Indonesia is the other country that exports nickel to China.
Abacus notes that once nickel-ore production is curtailed this would result in a run-up in the prices of nickel in the London Metal Exchange, thereby resulting in padded income levels for mining companies.
The forecast of Abacus insofar as the nickel mining sector is concerned seems solid enough even when ranged against the looming financial meltdown in the euro zone. Abacus pointed out that while the “situation in Europe is clearly very shaky and further losses in stock prices may be in the offing,” Philippine nickel miners will still benefit from changing mining policies in Indonesia and it will be a matter of time before Marcventures and other nickel stocks will reflect this in their respective share prices.”
The healthy prospects for the nickel mining sector, along with the continued rise in the remittances of overseas Filipino workers, could also further boost the Bangko Sentral’s dollar reserves.
Again, with our abundant mineral resources, strong global demand and high metal prices, there’s nothing but optimism in the near future for the Philippine mining industry.
Binay probes Federal Land
Makati Mayor Jun-jun Binay, otherwise known as Binay the Younger, has finally taken cognizance of the number of complaints that have reached his office regarding the construction of a third tower in Oriental Garden Condominium along Pasong Tamo or Chino Roces Avenue, which is being done much to the chagrin of original condo unit owners.
The original condo unit owners said they were enticed into buying units from the Federal Land’s Orchid and Lotus towers because they were promised a “garden atmosphere” in the property development. They were not told that a third tower, earlier named Lilac Tower and now being marketed as One Lilac Place, would be constructed. This has been the object of their complaints filed before the Housing Land Use Regulatory Board and other agencies.
Earlier, Federal Land, a member of the Metrobank Group of taipan George Ty, was fined for illegally selling units in Lilac Tower without a license, contrary to HLURB regulations. Residents are now pressing the HLURB to similarly impose fines for sales that were made in June to August 2011, or prior to the grant of a new license on August 31, 2011.
Meanwhile, the exchange of arguments and counterarguments between the condo owners and Federal Land continues, even as some residents have expressed apprehension over the increased number of residents who would be using the amenities that were previously reserved for the residents of the Orchid and Lotus towers alone.
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