In July 2024, Indonesian NPI production was 104,900 mt in nickel content, down 12.1% YoY and 6.5% MoM. The cumulative production for 2024 has reached 795,300 in nickel content, up 3.8% YoY. Supply side, although the RKAB approval quota for Indonesian laterite nickel ore reached 240 million wmt in July, the supply tightness for laterite nickel ore in the Indonesian market did not significantly improve, leading to high prices of Indonesian domestic trade laterite nickel ore. Therefore, the ore cost for Indonesian NPI smelting rose.
Demand side, downstream smelters' willingness to purchase laterite nickel ore continued to strengthen due to inventory constraints. However, the grade of available nickel ore in the market showed a certain decline, forcing Indonesian producers to source nickel ore from the Philippines. This situation, combined with the significant decline in laterite nickel ore shipping efficiency due to weather factors in July, led to the reduction in Indonesian NPI production in July. However, with the commissioning of new production lines in Indonesia in July, the future capacity ramp-up and the recent sustained rebound in NPI prices, the market has gained some production confidence. It is expected that Indonesian NPI production will recover to some extent in August, reaching 110,200 mt in nickel content, up 5.05% MoM but slightly down 5.9% YoY.
