TEMPO.CO, Jakarta - Indonesia’s Ministry of Energy and Mineral Resources (ESDM) predicts that copper prices will continue to rise until 2032 due to an imbalance between supply and demand.
"By 2032, the supply of copper compared to demand will begin to become unbalanced, so prices will definitely rise," said Tri Winarno, Director General of Minerals and Coal at the Ministry of Energy and Mineral Resources, at an event titled "Unlocking Growth in the Middle Income Trap" in Jakarta on Tuesday, as reported by Antara.
According to data from the London Metal Exchange, the price of copper in 2022 will range from US$7,000 to US$8,000 per ton. This price is lower than the price of copper in 2026, which reached $13,000 per ton between January and February of that year.
Similar projections apply to other raw materials as well, so Tri views the mining industry as having future growth opportunities, primarily through industrialization. On that occasion, Tri also noted that developed countries, such as those in the G7, are taking advantage of their demographic bonus by industrializing.
"Materials, such as raw materials and other things, are still needed by countries around the world. Unless they use recycling, this industry (mining) will definitely still be needed in the future," said Tri.
This statement addresses concerns about deindustrialization, which could disrupt Indonesia's downstream policy. Tri is optimistic that Indonesia will have opportunities in the future.
In addition to having raw materials, Tri said that the government is concerned with developing the quality of Indonesia's human resources (HR) to support industrialization, so Indonesia does not fall into the middle-income trap.
"Human resource development itself has already begun. It's already starting to grow," said Tri.
As previously reported, Chusnunia Chalim, the Deputy Chair of Commission VII of the Indonesian House of Representatives (DPR), stated that deindustrialization is characterized by declining industrial growth, layoffs, and dependence on imports. This phenomenon has the potential to hinder economic growth.
Early deindustrialization can hinder long-term economic growth because service sector productivity is lower than manufacturing productivity. To that end, he also suggested that the government strengthen policies related to vocational education and industrial job training.
Read: Nickel Prices Recover to US$17,000 as Indonesia Cuts Production
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