Financial Services Association, May 31 (Editor: Zhao Hao) Indonesia will allow continued exports of some copper concentrates, which is expected to reduce expectations that the global copper metal will be in short supply. Previously, copper prices had soared to record levels as a result.

According to local media, Indonesian Trade Minister Zulkifli Hasan (Zulkifli Hasan) announced on Friday (May 31) the extension of PT Freeport Indonesia (PT Freeport Indonesia)'s copper concentrate export license until December 31. The license was originally scheduled to expire today.

According to information, the Indonesian free port is$Freeport-McMoRan (FCX.US)$A subsidiary of, the Indonesian government is the majority shareholder. The company owns and operates the Grasberg copper-gold mine. The mine is located in the easternmost Indonesian province of Papua. It is currently known as the largest single gold deposit and the third largest copper deposit in the world.

In June of last year, the Indonesian government imposed an export ban on copper concentrates. The goal is to attract foreign investment to establish processing facilities locally, thereby boosting Indonesia's industrial process.

At the same time, however, the government granted permission to Indonesia's Freeport and PT Amman Mineral Internasional (PT Amman Mineral Internasional) to continue exporting copper concentrate because they have already built a smelter in Indonesia, and exporting copper concentrate can help fund the construction of the smelter.

However, it will take decades for the two companies' smelters to reach full capacity. Earlier, Amman mining executives said at a conference that the company is optimistic about the Indonesian government easing restrictions, “because restricting our exports is not beneficial to anyone, and the government also relies on free ports and our taxes.”

At the time, Indonesia's Freeport also argued that its smelter could not handle all production before May, and warned that if the Indonesian government refused leniency, the company might have to cut production. CEO Tony Wenas said after meeting with Indonesian Prime Minister Joko that if exports are not possible, the Indonesian government's revenue will be reduced by about 2 billion US dollars.

Last week, international copper prices climbed to record levels. The most active July futures contract in New York closed at a high of 5.106 US dollars per pound last Tuesday, and only then gradually regained its gains. Copper prices have been soaring since the beginning of this year.

Analysts believe that concerns about the US recession have abated as the labor market recovers and corporate profits are improving. Furthermore, China's economy, which accounts for “half” of global copper consumption, is showing signs of recovery, which has also stimulated demand for this industrial metal.

If companies such as Freeport Indonesia are unable to seize export opportunities when copper prices are high, it may hurt the Indonesian government's tax revenue and the government's profits from the company, because the Indonesian government is the largest shareholder of the Indonesian Freeport Corporation.

Editor/Somer