Posted on 26 Feb 2025
PT Gunbuster Nickel Industry (GNI) has said that the company's operations were not affected by the bankruptcy of its shareholder, China's Jiangsu Delong Nickel Industry (Delong Nickel), in an announcement on its website released on 25 February.
In response to recent media reports suggesting that the company is at risk of closure due to issues involving its parent company in China, GNI firmly states that its operations continue as usual and remain fully optimised, Kallanish notes.
It has announced changes in its operational management, a strategic move aimed at strengthening the company's structure to better navigate future industry challenges.
The company assures stakeholders that all decisions are made with careful consideration and a long-term vision for collective benefit. GNI acknowledges that this transition may cause temporary concerns.
In February 2019, Jiangsu Delong Nickel's local company in Indonesia, PT Virtu Dragon Nickel Industry (VDNI) commissioned a nickel smelter with 24 RKEF furnaces. The plant has a capacity of 1.8 million tonnes/year of nickel pig iron with a nickel content of 10-12%.
Despite PT GNI's denial of operational disruptions, market speculation suggests that the company is struggling to secure nickel ore due to a broken capital chain, potentially leading to a production halt at its smelter. Industry sources also suggest that PT GNI has already started reducing output and shifting towards maintenance.
Meanwhile, in China, market participants report that a major stainless steel mill in East China has been forced to cut production of its 304 hot rolling line by 50% due to raw material shortages stemming from the suspension of the Indonesian nickel pig iron plant. The mill, which typically produces around 100,000 tonnes/month of crude stainless steel, is now facing supply chain pressures.
As of the evening of 25 February, GNI's official channels had not responded to inquiries by Kallanish.
GNI's Chinese parent company Jiangsu Delong Nickel has entered the bankruptcy due to heavy debt. Public records indicate that Jiangsu Delong Nickel mortgaged CNY 8.45 billion ($1.16 billion) in property between 2015 and 2020 and pledged over CNY 1 billion in equity between 2020 and 2022.
Source:Kallanish
