Metal Movers: Nickel and Aluminium Markets Shaped by Indonesia Policies and Global Disruptions

The Indonesian government’s decision to slash the RKB nickel quota from roughly 380 million tonnes to 270 million tonnes—about a one‑third reduction—has rippled through the global nickel market. Major producers such as the Reda Bay mine saw their allocation fall from 42 million to 12 million tonnes, prompting temporary shutdowns and a tighter upstream supply. Consequently, nickel prices have stabilized between $17,000 and $19,000 per metric ton after peaking near $20,000 in April. Downstream segments like mixed‑hydroxide precipitate (MHP) and nickel‑pick‑iron (NPI) also face margin pressure, reinforcing the bullish price outlook.

Aluminum has experienced a parallel surge, with LME prices climbing to roughly $3,500 per tonne—about $1,000 above last year’s level—fueling a wave of new capacity. Indonesia’s output is projected to jump 84 % to around 1.5 million tonnes, while exports rose 49 % to over 220,000 tonnes, targeting markets such as South Korea, Vietnam and Turkey. The sector’s growth is constrained by electricity demand; a single tonne of primary aluminum consumes more than 30,000 kWh. Meanwhile, the U.S.–Iran conflict has cut Middle‑East aluminum shipments by over 80 %, tightening regional supply and lifting premiums.

Looking ahead, Indonesia’s creation of the state‑owned PTDSI to centralize commodity exports adds another layer of uncertainty. Although nickel products are not yet explicitly covered, the pending decision could reshape trade flows for ferrule‑nickel and MPI. Combined with ongoing power constraints, investors will monitor whether the country can move beyond upstream mining into value‑added aluminum and nickel processing. The convergence of tighter supply, higher margins, and geopolitical shocks suggests that both metals will remain focal points for global manufacturers seeking diversified sources. Stakeholders should therefore track policy updates, capacity ramps, and electricity pricing to gauge future price trajectories.