SMM Analysis On September Indonesian NPI Production And October Forecast

In September 2024, Indonesian NPI production slightly increased by 0.72% MoM and 1.3% YoY. The cumulative increase for 2024 was 6.5% YoY. On the supply side, the market's strong expectations for a significant release of Indonesia's RKAB laterite nickel ore quota in September were not realized. The supply from the Philippines continued to provide important support to the Indonesian nickel market. Additionally, with the weakening impact of weather factors in Indonesia and the gradual increase in circulating supply of domestic trade laterite nickel ore, the tight supply situation of nickel ore in the market was somewhat alleviated. On the demand side, with the ramp-up demand from new production line projects within the year and the potential for additional production from new lines in the fourth quarter, Indonesian smelters still have some potential for increased production. Furthermore, with the market still expecting new developments in the RKAB in October, the marginal easing of domestic laterite nickel ore supply in Indonesia is expected to continue, and the grade of Indonesian NPI will further improve. It is expected that in October, Indonesian NPI production will increase by 2.7% MoM and 8.4% YoY, with a cumulative increase of 6.7% YoY.