[SMM Nickel News Flash] Indonesia Released New HPM Formula, SMM Estimated MHP Production Cost Expected to Rise by About $1,700/mt Ni

[SMM Nickel Flash] April 13 — According to SMM, Indonesia has officially released the new nickel ore HPM coefficient. Based on the benchmark price as of April 1, the HPM price for 1.5% nickel ore is expected to see a notable raise. Under the old formula, the nickel ore HPM price was $26.66/wmt, while under the new formula, it is $48.42/wmt. Assuming the tax costs arising from the HPM price increase are fully passed through to downstream sectors, the absolute price of nickel ore is expected to rise to approximately $71.25/wmt after the new policy takes effect. The current SMM 1.5% nickel ore CIF price is $68.20/wmt. Based on this calculation, the adjustment is expected to push NPI full costs up by approximately 2.55% from current levels, providing further upward support for NPI prices.

The following table shows the ferrous and nonferrous metals movement on the SHFE and DCE on 13 Apr , 2026

Effective April 15, 2026, Indonesia’s ESDM will implement a revised Nickel Ore HPM formula. The Correction Factor (CF) for 1.6% grade ore rises to 30%, decreasing by 1% for every 0.1% drop in nickel grade. Byproducts are now explicitly valued: Cobalt and Iron carry a 30% CF, while Chromium is 10%. Crucially, cobalt will only be factored into the pricing if its content is >= 0.05%, and iron content must be <= 35% to be included in the calculation. HPM Nickel Ore = 【(HMA Nickel * %Ni * CF Nickel Ore) + (HMA Cobalt * %Co * CF Cobalt ) + (HMA Iron Ore * %Fe *CF Iron) + (HMA Chrome Ore * %Cr * CF Chrome)】*（1-MC)