Nickel rebounds near $16,950/ton as Indonesia output cut risks grow
Nickel traded around $16,950 per tonne, rebounding from an over one-month low. IMIP warned El Niño water shortages could cut production by 30%-40% without new sources; talks on ~30% HPAL output cuts are also being considered.
Nickel traded around $16,950 per tonne, rebounding from an over one-month low as potential production cuts at Indonesia’s largest nickel-processing hub raised concerns over a tightening supply outlook.
Indonesia Morowali Industrial Park (IMIP) said El Niño-driven water shortages could reduce production by 30%-40% if new water sources are not secured, raising concerns over global availability.
Some Chinese-backed nickel producers are also considering coordinated output cuts of around 30% at HPAL plants amid weak prices and rising operating costs, although no agreement has been reached.
Indonesia’s tighter 2026 mining quota further points to lower ore availability, with the limit set at around 260-270 million tonnes vs 379 million tonnes in 2025.
Meanwhile, elevated inventories and weak Chinese demand continued to weigh on prices, while higher imports of Philippine nickel ore into Indonesia could help offset tighter domestic supply.