Indonesia rules out raw mineral exports as US seeks smelter curbs in trade deal

Indonesia will not export raw minerals to the United States under a newly signed reciprocal trade agreement, officials said, even as the pact commits Jakarta to lift export restrictions on processed critical minerals and strengthen cooperation in the sector.

Energy ministry spokesperson Dwi Anggia said provisions on critical minerals in the agreement are primarily aimed at encouraging investment and do not alter the country’s downstream policy banning exports of unprocessed resources.

Coordinating Economic Affairs Minister Airlangga Hartarto said the removal of export restrictions applies only to industrial minerals that have undergone secondary processing, stressing that raw shipments remain prohibited. The policy aligns with Indonesia’s push to develop domestic refining and value added production.

The trade pact nonetheless calls for Indonesia to remove barriers on exports of industrial commodities, including critical minerals, to support supply chain connectivity with the United States. Minerals classified as critical under national rules include nickel, copper, aluminium, tin, magnesium, manganese and cobalt, among others.

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The agreement also outlines deeper cooperation in mining, processing and downstream production of critical minerals, including rare earth elements, with U.S. companies expected to participate in projects aimed at building secure and diversified supply chains.

In parallel, Washington has requested Indonesia to limit excess output from foreign owned smelters and ensure industrial estates and processing facilities operate under the same tax, environmental, labour and legal requirements as other companies.

According to the agreement, Indonesia will align smelter production with mining quotas across facilities processing commodities such as nickel, cobalt, bauxite, copper, tin and manganese, while maintaining equal regulatory treatment for foreign and domestic operators.

Officials said the commitments reflect a balance between attracting investment and preserving Indonesia’s downstream industrial strategy, with both countries pledging continued engagement to strengthen critical mineral supply chains and technology cooperation.  

Editing by Alexander Ginting