Key Moments
- Benchmark nickel on the London Metal Exchange advanced 2.3% to $19,445 per metric ton by 0900 GMT.
- Prices briefly touched $19,470 per metric ton, the highest level since June 2024.
- Indonesia set a nickel ore production quota of 260 million to 270 million tons, below estimated demand of 340 million to 350 million tons from smelters.
Nickel Hits Near Two-Year Peak
Nickel prices moved sharply higher on Monday, with the benchmark contract on the London Metal Exchange reaching levels not seen in almost two years. Market participants focused on tightening supply signals, particularly from Indonesia, alongside concerns about limited availability of sulphur used in metal production.
By 0900 GMT, benchmark nickel was up 2.3% at $19,445 per metric ton, after briefly rising to $19,470 per metric ton. That intraday high marked the strongest price since June 2024.
Indonesian Production Quotas Versus Smelter Demand
Supply expectations from Indonesia, a key nickel producer, have come under scrutiny following new production guidance. The country set its nickel ore output quota, referred to as RKAB, in a range of 260 million to 270 million tons for the year.
In contrast, the nickel smelter association FINI projected that smelters will require between 340 million and 350 million tons of ore. This indicates a significant shortfall between the officially approved production quotas and anticipated ore demand from the processing sector.
| Measure | Range / Value |
|---|---|
| LME benchmark nickel price by 0900 GMT | $19,445 per metric ton |
| LME intraday high | $19,470 per metric ton |
| Indonesia nickel ore production quota (RKAB) | 260 million – 270 million tons |
| Estimated demand from nickel smelter association FINI | 340 million – 350 million tons |
Additional Supply Constraints
Beyond the Indonesian quota and demand imbalance, the nickel market has also been affected by reported shortages of sulphur, a key input in certain metal production processes. These combined supply-side pressures have contributed to the recent strength in nickel prices.
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