Indonesia is poised to capture a significant share of the global copper market by 2028, driven by declining global production and increasing demand, projected to grow 4%-5% annually. Speaking at the CEO Insight event in Jakarta on Tuesday, Indonesian Mining Association (IMA) Chairman Rachmat Makkasau highlighted copper's rising importance, especially in green technology. With the world's seventh-largest copper reserves, Indonesia is expected to reach a production capacity of 1.2 to 1.4 million tons by 2028, while domestic demand is estimated at 350,000 tons. The government aims to optimize this surplus through downstream industrialization to reduce reliance on exporting copper cathodes. Over the past seven years, Indonesia has encouraged mining downstreaming by building smelters, but most downstream products are still exported due to limited domestic absorption capacity.
In 2023, copper was one of Indonesia's main export commodities, with China importing 684,350 tons, accounting for 22.9% of total exports, followed by Japan (654,240 tons) and South Korea (446,770 tons). However, starting January 2025, the government plans to ban copper concentrate exports to reduce dependency on raw material exports. While this policy aims to increase value-added production, it may impact state revenues, with the Ministry of Finance estimating a potential loss of IDR 10 trillion. Industry optimization and domestic downstreaming are expected to enhance the competitiveness and economic value of Indonesia's copper sector in the coming years.
