Indonesian Nickel Industry Association: Indonesia's nickel capacity utilization may drop to 70%; imported nickel ore expected to surge significantly

The Indonesian Nickel Industry Association (FINI) said on Friday that due to lower nickel ore production quotas, Indonesia’s nickel processing capacity utilization rate in 2026 may fall to as low as 70%, while nickel ore imports are expected to increase significantly. FINI Chairman Arif Perdana Kusumah said that this year, Indonesia’s nickel processing capacity utilization rate may fall to 70%–75%, below last year’s level of about 90%. This year, Indonesia’s nickel processing capacity is about 2.7 million tons, which would require about 340 million to 350 million wet weight tonnes of nickel ore. An Energy Ministry official, Tri Winarno, said that the nickel ore production quota has been set at 260 million to 270 million tons. FINI said that Indonesia’s nickel ore imports are expected to rise to 50 million tons this year, from about 15 million tons last year, with about 30 million tons expected to come from the Philippines. Arif said that the effects of the decline in nickel ore production quotas have already begun to show, for example through higher nickel ore prices. “The impact of the decline in capacity utilization is expected to become apparent by the end of the second quarter of this year, when a shortage of nickel ore raw materials will begin to emerge.”