Market rumors suggest that Chinese-owned nickel producers in Indonesia are considering cutting nickel pig iron (NPI) output by 20% and MHP battery material production by 50% due to profit pressure, according to a report published by Yieh Corp Steel News (yieh.com) on October 29, 2026. However, no official plans have been confirmed, so the reported cuts remain unverified. The Indonesian government appears supportive of production cuts, as lower supply could boost nickel and ore prices and help maintain royalty income.
According to the same source, the government may also review ore production plans if demand from smelters declines. Indonesia's policy remains mixed. While the government is considering limits on new smelter capacity, it plans to raise the 2026 nickel ore quota to about 290 million tons, up from 250-260 million tons, in order to secure ore supply for existing smelters.
Nickel prices briefly rose from US$14,885 to US$15,935 per ton on October 22 in response to the production-cut rumors, before easing to US$15,535 per ton on October 26, the source reports. NPI prices in China and Indonesia have remained stable, which suggests that supply has not yet tightened. The LME official bid price table on the source page listed nickel at US$15,430.00 per ton for cash and US$15,645.00 per ton for three months.
According to Yieh Corp, if the production cuts are implemented, they could improve market balance and support prices. However, with higher ore quotas and no confirmed cuts, the market outlook will depend on actual production levels in Indonesia and on demand from Chinese stainless steel producers. Source: Yieh Corp Steel News, "Indonesian nickel industry supply adjustments may drive price increases", 29 October 2026 (https://yieh.com/en/News/indonesian-nickel-industry-supply-adjustments-may-drive-price-increases/163158).
Source: yieh.com