Indonesia is considering a moratorium on new plants that make partly processed nickel such as nickel pig iron, senior minister Bahlil Lahadalia said on Wednesday. The aim is to support prices hit by an oversupply of these products and push investment toward finished goods.
At a glance
- Bahlil said Indonesia may minimise semi-finished nickel industries and promote those making end products.
- Indonesia is the world's largest exporter of nickel products, mostly crude metals such as nickel pig iron and ferronickel.
- The government will also keep controlling nickel mining quotas to support prices.
Background
Indonesia accounts for more than 60% of global nickel output. Most of it leaves the country as semi-finished products: nickel pig iron (NPI) and ferronickel, which go into stainless steel. Building more of these plants has added so much supply that prices have fallen, and the government now wants more refining into higher-value finished products.
What happened
Indonesia is discussing a moratorium on new nickel processing plants that make partly processed metals, Bahlil Lahadalia, the senior minister overseeing mining, told reporters on Wednesday. The plan is part of efforts to prop up prices of nickel products.
"We are considering to minimise the industries that produce semi-finished products, and we may even impose a moratorium, while we promote industries that produce end-products," Bahlil said.
Why it matters
Bahlil said oversupply of partly processed nickel from Indonesia has caused prices to drop. Indonesia is the world's largest exporter of nickel products, but most of its shipments are crude metals such as nickel pig iron and ferronickel.
Bahlil was named coordinating minister for downstreaming and energy transition in President Prabowo Subianto's cabinet reshuffle last week, on top of his role as energy and mining minister. The new post is meant to streamline investment into downstream industries.
What it means
A moratorium would slow the growth of nickel supply that has kept the market in surplus. Sumitomo Metal Mining expects a 34,000-tonne global surplus in 2027. It sees Indonesian nickel pig iron output falling 2.3% this year after quota cuts, then rebounding 11.9% to 1.88 million tonnes next year. Because Indonesia accounts for more than 60% of global nickel output, its policy choices set the direction for the whole market.
The government will also keep using mining quotas to support prices, Bahlil said. Together, the two tools give Jakarta more control over how much nickel reaches the world market, which matters for stainless steel and battery makers worldwide.
Our read
Outlook: bullish. Curbing new semi-finished nickel capacity would slow supply growth from the largest producer. The plan is still under discussion, so its effect depends on what is finally adopted.
What to watch
- Whether Indonesia formally announces the moratorium and which products it covers.
- Indonesia's 2027 nickel mining quotas.
- Nickel price reaction to tighter Indonesian supply policy.
For information only, not investment advice.
Nickel price in India
metalscost.com India reference price as of 2026-10-16.
Detailed analysis
Timeline
- 2026-10-07: Bahlil Lahadalia says Indonesia is considering a moratorium on new semi-finished nickel plants.
Supply Drivers
A moratorium would slow growth in Indonesian nickel pig iron and ferronickel supply.
Government Policies
Indonesia is weighing limits on semi-finished nickel plants alongside mining quotas.
What could lift prices
- Limits on new plants would slow supply growth from the largest producer.
- Mining quota controls remain in place to support prices.
What could weigh on prices
- The plan is still under discussion and may not be adopted.
- Existing plants keep running, so current supply is unchanged.
Country impact
| Country | Impact | Reason |
|---|---|---|
| Indonesia | High | The policy would reshape investment in its dominant nickel industry. |
Industry impact
| Industry | Effect | Reason |
|---|---|---|
| Stainless Steel | Negative | Slower nickel pig iron growth could raise stainless steel input costs. |
Who gains, who loses
- Nickel miners outside Indonesia: Slower Indonesian supply growth could support prices.
- Investors planning new NPI plants: A moratorium would block new semi-finished nickel projects.
Other ways this could play out
- If the moratorium is adopted, Indonesian nickel supply growth could slow from 2027.
- If the plan is shelved, oversupply could continue to weigh on prices.
Price risks
- Higher Indonesian mining quotas would add supply regardless of a moratorium.
- Weak stainless steel demand would limit any price gains.
Technical view
Price is trading below both its 20-period and 50-period moving averages, a bearish alignment.
Computed from metalscost.com's own stored price history.
