Jakarta, CNBC Indonesia - The government has officially implemented a\nnew formula for the Mineral Benchmark Price (HPM) starting from 15 April\n2026. This policy is contained in Ministerial Decree\nNo.\u00a0144.K\/MB.01\/MEM.B\/2026 on Amendments to Ministerial Decree\nNo.\u00a0266\/2025 regarding Guidelines for Determining Benchmark Prices for\nthe Sale of Metal Mineral and Coal Commodities.<\/p>\n
Chairman of the Indonesian Mining Experts Association (PERHAPI)\nSudirman Widhy Hartono assessed that the HPM formula change will have\ndiffering impacts on business players in the upstream and downstream\nnickel sectors.<\/p>\n
According to him, for nickel mining permit (IUP) holders, the HPM\nrevision opens opportunities for price increases in selling ore to\nprocessing plants. This increase applies to both saprolite and limonite\ntypes of nickel ore.<\/p>\n
In fact, for limonite, the increase could reach more than 100%, as\nthe cobalt content in limonite is now factored into the formula.<\/p>\n
\u201cThis means that the profits obtained by miners will experience a\nsignificant increase,\u201d Widhy told CNBC Indonesia on Wednesday\n(15\/4\/2026).<\/p>\n
However, on the other hand, he warned that this policy could become a\nheavy burden for the nickel processing industry (smelters). The HPM\nincrease will raise production cost burdens amid global nickel prices\nthat have not fully recovered.<\/p>\n
\u201cEven without the HPM increase, the operational cost burden for\nnickel processing plants is already high, while world nickel prices have\nnot returned to their best levels,\u201d he said.<\/p>\n
For example, for smelters based on Rotary Kiln Electric Furnace\n(RKEF) producing Nickel Pig Iron (NPI) and ferronickel, the cost\npressure mainly comes from rising energy prices, following increases in\ncoal and fuel oil prices. Meanwhile, NPI prices in the global market\nremain under pressure due to weak demand and overproduction\nconditions.<\/p>\n
Meanwhile, smelters based on High Pressure Acid Leaching (HPAL) that\nprocess limonite into Mixed Hydroxide Precipitate (MHP) face even\ngreater pressure. This is triggered by the surge in sulphuric acid\nprices as the main input for the leaching process.<\/p>\n
\u201cSulphuric acid, which is the main material for the leaching process,\nhas experienced a significant increase over the past three years, from\nbelow US$100\/ton previously to now reaching US$250\/ton,\u201d he said.<\/p>\n
According to him, with the limonite price increase of more than 100%,\nthis will certainly cause HPAL plants to face the greatest pressure.<\/p>\n
Based on PERHAPI\u2019s calculations, the combination of the HPM increase\nand the sulphuric acid price surge could potentially push nickel\nproduction costs in the form of MHP above US$17,000 per tonne. This\nfigure is almost equivalent to the current nickel price in the global\nmarket based on the London Metal Exchange.<\/p>\n
His side understands the background and purpose of this nickel HPM\nchange, one of which is to increase nickel royalties. However, PERHAPI\nemphasised that the policy should also consider the sustainability of\nthe nickel downstream industry.<\/p>\n
\u201cBecause if the economics of nickel processing plants become\nunattractive, the dominant impact and effects will be long-term, as it\nwill cause nickel processing plants to stop operations,\u201d he said.<\/p>\n
As is known, this regulation has been widely discussed by the\nMinistry of Energy and Mineral Resources some time ago. Director General\nof Minerals and Coal (Dirjen Minerba) of the Ministry of Energy and\nMineral Resources Tri Winarno revealed that the new nickel HMA formula\nwill take into account the value of associated minerals in nickel\nore.<\/p>\n
According to him, these highly economically valuable associated\nminerals, such as cobalt and iron, have not been optimally priced so\nfar. \u201cEvery month, we report that previously it was based on LME (London\nMetal Exchange) with certain correction factors. For cobalt, we price\nit, for iron we price it, so the reference price can increase,\u201d Tri\nexplained some time ago.<\/p>\n
The changes prepared by the government, said Tri, are purely on the\ncalculation formula, namely the correction factor and valuation of\nassociated minerals. Meanwhile, the issuance and determination schedule\nfor the reference price will continue routinely as usual without changes\nin the release period.<\/p>\n
\u201cIf it\u2019s issued every two weeks, we still issue it. The formula\nchanges. The formulas,\u201d he stressed.<\/p>\n
For information, the HMA formula change for nickel is part of the\ngovernment\u2019s efforts to increase state revenues from the mineral sector.\nThis is also in line with the directives of Indonesian President Prabowo\nSubianto, who requested the optimisation of state revenues from natural\nresources, particularly the mineral sector.<\/p>", "url": "https:\/\/jawawa.id\/newsitem\/bahlil-officially-changes-mineral-benchmark-price-formula-business-owners-speak-out-1776228651", "image": "" }, "sponsor": "Okusi Associates", "sponsor_url": "https:\/\/okusiassociates.com" }