Indonesian Nickel Industry Association: Indonesia's nickel capacity utilization may drop to 70%, with a significant increase in imported nickel ore expected

Gelonghui, March 6 — The Indonesian Nickel Industry Association (FINI) stated on Friday that due to a decrease in nickel ore production quotas, Indonesia’s nickel processing capacity utilization may drop to as low as 70% by 2026, while nickel ore imports are expected to increase significantly. FINI Chairman Arif Perdana Kusumah said that this year, nickel processing capacity utilization could fall to between 70% and 75%, down from about 90% last year. Indonesia’s nickel processing capacity this year is approximately 2.7 million tons, which requires about 340 to 350 million wet metric tons of nickel ore. Energy Ministry official Tri Winarno said that the nickel ore production quota has been set at 260 to 270 million tons. FINI indicated that Indonesia’s nickel ore imports are expected to rise to 50 million tons this year, up from about 15 million tons last year, with approximately 30 million tons expected to come from the Philippines. Arif stated that the impact of the decline in nickel ore production quotas has already begun to show, such as rising nickel ore prices. “The effects of reduced capacity utilization are expected to become apparent by the end of the second quarter of this year, when a shortage of nickel raw materials will begin to emerge.”