LME nickel edges up on supply concerns, Indonesia developments in focus

• Prices rise on tightening supply cues
• Indonesia policies and mine disruptions shape outlook

Nickel prices on the London Metal Exchange (LME) strengthened in the week ended 24 April, with the three-month contract closing at $18,800/t, up 1.3% w-o-w from $18,560/t. LME inventories remained largely stable at 277,548 t, indicating balanced exchange stocks amid steady participation.

The uptick was primarily supported by tighter mining regulations in Indonesia, which have reinforced expectations of a structural supply shift. Projections from the International Nickel Study Group (INSG) indicate the market may move from a surplus of 283,000 t in 2025 to a deficit of 32,000 t in 2026, lending further support to sentiment.

In addition, a weaker US dollar and expectations of increased liquidity following China’s upcoming ultra-long special bond issuances improved risk appetite across the base metals complex, contributing to the recent price recovery.

Macro matters

Weda Bay nickel mine faces potential pause on quota exhaustion

Eramet’s Weda Bay Nickel mine in Indonesia may halt operations by May 2026 after nearing its reduced annual mining quota. The allowance was cut to 12 million wet metric tonnes (wmt) from 32 million in 2025, tightening supply. With most volumes already allocated, the miner may shift to care and maintenance, highlighting the impact of Indonesia’s stricter ore policies on global nickel supply dynamics.

Vale secures $750 million green loan to fund nickel expansion

Vale Indonesia has secured a $750 million sustainability-linked loan, with an option to raise an additional $250 million, to support its nickel expansion plans. The facility, backed by 14 global banks, reflects strong investor interest in EV-linked metals. Funds will be directed toward key growth projects, while aligning operations with decarbonisation goals through renewable energy use and reduced carbon intensity, strengthening its position in the low-carbon nickel supply chain.

Outlook

Nickel prices are expected to remain firm but volatile in the near term. Supply-side risks from Indonesia, rising input costs, and geopolitical uncertainties may provide support, while persistent surplus conditions and moderate demand growth are likely to cap sharp upside. Market participants will closely track Indonesia’s policy direction and inventory movements for clearer price signals.