The Philippines' Second-largest Nickel Producer Saw Its Shipments Fall 41% Year On Year in 2022

The Philippines said its nickel mine output in the first half of 2022 fell 20 per cent year on year to 10.8m dry tonnes. Miners have scaled back production and export targets, mainly because of bad weather caused by La Nina and weak downstream demand.

Philippine nickel producer Global Ferronickel Holdings Inc. said its January-June 2022 consolidated net profit fell 34.9 percent to 417.4 million pesos, hurt by bad weather that made it difficult for the company to ship more nickel ore. Revenue also slipped 15% to 2.21 billion pesos.

FNI said the group encountered 128 days of rain in the first half compared to 105 days in the same period of 2021. A total of 19 nickel ore shipments totaling 1,035 million wet tons were successfully completed in the first half of the year, with nickel ore shipments down 41% year over year, including 816,000 wet tons of low-grade nickel ore and 219,000 wet tons of medium-grade nickel ore. In 2021, there were 32 shipments totaling 1.74 million wet tons.

FNI President Dante R. Bravo said he hoped for better weather in the third quarter, the peak of the PGMC [Platinum Group Metals Corp.] mining season, which typically generates more than 60 percent of FNI's annual revenue. PGMC International Limited (PIL), a wholly-owned subsidiary of FNI, is located in North Surigao with a mining area of 4376 hectares and is the second largest nickel ore exporter in the Philippines. It aims to produce minerals that facilitate trade relations with Chinese customers.

FNI said the first-half results were driven by PGMC's mining operations in Surigao del Norte from April to June. Despite lower sales volumes in the first half, FNI said nickel ore prices were also higher in the first half of 2022 compared to the previous period. The overall average realized nickel ore price was US $39.21 per ton, compared to US $31.10 per ton in the same period of 2021, increasing revenue by 405 million pesos.

在2022年上半年,FNI镍矿石销售mix was 79% of low grade ore and 21% of medium grade ore, comprising 816,000 wet tons of low grade nickel ore and 219,000 wet tons of medium grade nickel ore; This compares with a sales mix of 84% low grade ore and 16% medium grade ore in the previous period, representing 1.465 million wet tonnes of low grade nickel ore and 275,000 wet tonnes of medium grade nickel ore.

At the same time, the company lowered its annual shipment target to 4 million wet tons, down 18 percent from a year earlier.