Indonesia is considering options to limit nickel ore production to offset falling international prices. The Ministry of Energy and Mineral Resources said that excess supply in the global market is pressuring prices, necessitating steps to balance the market.
Nickel prices have fallen from a peak of USD 48,199 per ton in May 2022 to USD 15,500 as of December 24, 2024. According to market sources, the pressure on prices is expected to continue until the end of the year due to weak demand and global economic uncertainties.
Increasing global conflicts, disruptions in supply chains and economic downturns are among the other factors negatively affecting nickel demand. The World Bank reported that the price decline in the third quarter of 2024 is due to increased production and lower demand from the stainless steel and battery markets.
Indonesia, which has 52% of the global total with 72 million tons of reserves, considers the nickel sector as a strategic resource. The government prioritizes investments in the sub-sector to create added value and provide employment. Authorities state that market stability can be achieved by improving supply management.
On December 24, nickel futures prices on the London Metal Exchange (LME) increased by USD 185 per ton to USD 15,477, while spot prices increased by USD 197 to USD 15,257. However, LME nickel stocks decreased by 1,020 tons to 162,048 tons.
During the same period, the US Dollar Index maintained its strength, while new economic stimulus measures announced by China created optimism in the markets. Analysts predict that nickel prices may fluctuate in the short term due to current uncertainties.
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