- Vale expands nickel capacity with new furnace in Brazil
- Indonesia’s nickel ore imports surge on smelter growth
Nickel futures on the London Metal Exchange (LME) showed slight upward movement last week, with moderate fluctuations. The three-month nickel futures traded between $15,270-15,290/tonnes (t) early in the week before settling at $15,290/t on 3 October, a slight increase from the previous week’s close at $15,225/t.
During the same period, LME warehouse inventories rose slightly to 231,504 t on 2 October from 230,124 t on 26 September, reflecting ongoing supply pressure in the market.
Nickel prices sink to 5-year low amid oversupply
In Q3CY’25, nickel prices hit five-year lows due to persistent LME oversupply, despite robust demand for nickel sulphate and mixed hydroxide precipitate (MHP) in China. China’s strategic restocking efforts helped support demand for chemical intermediates, contrasting with weak buying from the stainless steel and battery sectors. Indonesian production growth added to oversupply pressures, keeping prices subdued. The market reflects a complex balance between short-term oversupply and confidence in long-term demand fundamentals, driven by EV battery growth and supply disruptions.
Global nickel smelting sees uptick after 3 months of decline
Global nickel smelting rebounded in August 2025 after a three-month slump, driven by improved production in Indonesia and China. Despite China’s smelting inactivity remaining elevated at 20.8%, other regions such as South America and Africa showed strong operational performance. European smelters remained largely inactive. This resurgence in smelting activity marks a positive shift amid ongoing market challenges, supporting supply stability and potentially influencing nickel prices in the coming months.
Vale Base Metals boosts nickel capacity with new furnace at Onca Puma
Vale Base Metals has commissioned a new nickel furnace at its Onca Puma complex in Brazil, increasing production capacity by 60% to 40,000 t annually. This expansion strengthens Onça Puma as Brazil’s largest ferro nickel operation, enabling higher output at lower costs. Despite current low nickel prices due to oversupply from Indonesia, the company highlighted the operation’s strong positioning for market recovery. Vale projects global nickel production of 160,000-175,000 t in 2025, aiming for 210,000-250,000 t by 2030.
Indonesia’s nickel ore imports surge, driven by smelter expansion
Indonesia’s nickel ore imports surged sharply in 2025, primarily fuelled by the rapid expansion of domestic smelter capacity. The increased processing capability boosted demand for imported ores, especially from the Philippines. This growth supports Indonesia’s ambition to transform into a global nickel refining hub, shifting focus from raw ore exports to higher-value downstream products. Despite supply challenges such as the rainy season and policy reforms, Indonesia remains a pivotal player, increasingly influencing global nickel supply dynamics and pricing throughout 2025.
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