Due to COVID-19 lockdown restrictions, the Philippines, the world’s top nickel producer and one of the most mineralized countries globally, saw a decline in the value of its metals from gold to nickel ore, while production of all exportable mineral commodities also significantly fell during the first half of the year.
Data from the Mines and Geosciences Bureau (MGB) showed that the country’s metallic mineral production value went down by 14.37 percent in the first six months of the year to P53.88 billion from the P62.92 billion recorded in the same period in 2019.
Production, too, went down by double digits for nickel ore, gold, copper, silver, and chromite from January to June.
MGB said that during the period, the performance of the country’s metallic sector was “seriously dictated” by the current happenings worldwide including COVID-19 pandemic, slow economic activities, lethargic world metal prices, and limited and hampered mining operations.
Right now, the country’s traditional markets include China and Japan for nickel and copper and Switzerland and Hongkong for gold.
In terms of percentage, nickel ore, together with its nickel products, had the largest contribution to the total metallic production value, accounting for 44.79 percent or P24.13 billion.
However, during the period, nickel ore alone incurred production volume and value shortfall of 28 percent and 21 percent, respectively, from 141,584 metric tons (MT) with an estimated value of P12.33 billion in the first half of 2019 to 102,310 MT with an estimated value of P9.76 billion in the first half of this year.
Dante Bravo, president of Philippine Nickel Industry Association (PNIA), said the major factor for the decline for nickel alone was the lockdown, which disrupted movement of mineral products and mine personnel across the country.
As early as March, the Philippines was placed under the enhanced community quarantine (ECQ), the government’s top measure to fight the highly fatal and contagious COVID-19 virus. The strict lockdown measures, supported by police checkpoints across many areas, lasted until May.
Bravo said this forced some nickel miners to stop operations by the third week of March and resume during the first week of May.
MGB said that with the exemption of six nickel projects, namely Rio Tuba Nickel Mining Corporation, Adnama Mining Resources Inc., SR Metals Inc. (SRMI), Agata Mining Ventures, Inc., Carrascal Mining Corporation, and Marcventures Mining and Development Corporation, all the remaining nickel producers reported production-value deficits.
In the case of SRMI, it reported no production during the first semester of the year for being on care and maintenance status at that time.
“We expect, however, that production in the provinces of Surigao and Dinagat Island will at least pick-up or improve in the coming months since weather conditions will be more apt for mining operations. It is important to note that of the 10 mining operations in Dinagat Island, only Cagdianao Mining Corporation and Libjo Mining Corporation reported production,” MGB said.
During the period, nickel price slightly increased from $12,316.06 per ton to $12,473.17 per ton.
Next to nickel, gold accounted for 41.51 percent or P22.12 billion of the country’s total mineral production.
Though this was a decline of 10 percent from the value of P24.5 billion in the same period last year, MGB attributed the current value to the much-improved price of yellow metal in the world market from US$1,307.36 per troy ounce to $1,647.44 per troy ounce.
Market analysts believed that gold prices would continue to go up given the current world economic situation, MGB said.
In terms of production, gold saw a 27 percent decline in output, producing 8,246 kilograms during the period compared to the 11,252 kilograms recorded in the same period last year.
Meanwhile, output performance of silver and copper fell by 30 percent and 17 percent respectively, while chromite’s output fell by 39 percent.
During the period, combined mine output of silver and chromite accounted for less than 1 percent or P430 million of the country’s total minerals output. Copper contributed P7.19 billion or 13.50 percent.