Indonesia's Q2 bauxite downstream investment jumps 193% to $2.23B, surpassing nickel

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Minister of Investment and Downstream Processing and Head of the Investment Coordinating Board (BKPM) Rosan Roeslani stated that realised investment in bauxite downstream processing reached IDR 40.1 trillion (approximately USD 2.23 billion) during Q2 2026. This is a 193 per cent increase from IDR 13.7 trillion (USD 765 million) in the previous quarter. The minister said the surge was driven by the development of several bauxite processing facilities by both domestic and foreign investors.

Rosan said, “Bauxite has taken first place for the first time, surpassing nickel” as the largest downstream mineral investment category. Investment in nickel downstream projects stood at IDR 29.4 trillion (USD 1.6 billion), followed by copper at IDR 16.7 trillion (USD 932 million), iron and steel at IDR 13.2 trillion (USD 737 million), silica sand at IDR 4 trillion (USD 223 million), and other mineral commodities at IDR 4.7 trillion (USD 262 million).

Overall, Indonesia's downstream investment reached IDR 152.7 trillion (USD 8.5 billion) in the second quarter, representing a 5.7 per cent increase year on year and accounting for 29.8 per cent of the country's total realised investment of IDR 511.8 trillion (USD 28.6 billion). Rosan said the latest figures show that Indonesia's downstream processing programme is becoming more diversified instead of relying mainly on nickel projects.

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Employment also increased alongside the investment. BKPM reported that downstream projects created 742,263 jobs during the second quarter, up 5.1 per cent from the previous year. Total realised investment during the first half of 2026 generated 1,448,862 jobs, around 15 per cent higher than the corresponding period in 2025.

One of the major projects supporting the growth is Phase I of the Smelter Grade Alumina Refinery (SGAR) in Mempawah, West Kalimantan, which has an annual production capacity of 1 million tonnes of alumina per annum.

Lawmakers also welcomed the strong growth in bauxite investment. Commission XII member Eddy Soeparno said the increase marked significant progress for Indonesia's bauxite downstream industry, which had previously lagged behind nickel, and called for further expansion into value-added downstream manufacturing. Commission XII member Syarif Fasha stressed the need for consistent government policies to ensure that the benefits of downstream investment are shared fairly with resource-producing regions and local communities.