Nickel: What lies ahead?
Nickel has emerged as a critical metal in the energy transition in recent years, particularly for the vital role it plays in the electric vehicle (EV) battery sector, but it has also been an industry fraught with volatility. The rapid development of new supply fundamentals in a shifting geopolitical landscape continue to drive regular sharp swings in prices for nickel products. And 2025 could add more complexities, as US president Donald Trump pulled a U-turn on EVs immediately after returning to the White House, European EV sales resume growth and the China-Indonesia machine looks to accelerate its nickel supply growth momentum. 2025 could be a pivotal year for the nickel value chain, shaping long-term price trends and supply-demand dynamics.
Argus Interactive Insights
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4 Market Drivers
2025 will be a year to patch up and resolve various issues before an inflection point in 2026, as the aerospace market addresses unresolved bottlenecks, tests and potentially qualifies Chinese titanium sponge, and normalises inventories.
RKAB still the talk of the town
Nickel use in batteries: Will the momentum continue?
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Indonesia stainless steel output growth slows
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Alternative nickel value chains: Can US succeed?
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Could Indonesia cobalt replace Canadian cobalt in the US?
As of the end of January, Indonesia’s ministry of energy and mineral resources (ESDM) has approved close to 300 nickel mining production and exploration quotas, known as RKABs, with total approved volumes close to 300 mn wet metric tonne (wmt), according to Argus’ estimates. The approved volumes exceeded the 246-265mn wmt needed to meet Indonesia’s expected nickel pig iron (NPI), mixed hydroxide precipitate (MHP) and matte output of 2.41mn t nickel metal equivalent in 2025. This has sparked concern about a significant surplus in ore supply and places pressure on nickel prices. While it looks almost certain that there are sufficient RKABs this year, concerns remain around how the allocated quotas are shared between pyrometallurgical and hydrometallurgical plants, their distribution across domestic regions and whether physically mined ore will match announced volumes.
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Story
Data
Facts
Nickel output and demand
Indonesia Nickel Index (INI) NPI 10-14% fob Indonesia
Indonesia Nickel Index (INI) MHP nickel payable 37% min fob Indonesia
Indonesian imports of nickel ore from the Philippines, the world’s second largest producer, rose to a record level exceeding 10mn t in 2024
Indonesia represents 59.5% of global mined nickel output in 2024, according to USGS
Indonesia NPI export prices fell by 10pc between November 2024 to January 2025
Indonesia’s ore demand is projected to reach 246mn wet metric tonnes (wmt) in 2025
Argus Non-Ferrous Markets service
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Indonesia Nickel Index (INI) matte 70% min fob Indonesia
Global nickel demand for EV batteries rose by about 20pc to 385,000t in 2024 and is set to rise by another 20pc to 481,000t in 2025, according to Argus Consulting. Key to the acceleration of nickel-based battery chemistries in EV adoption has been low LME nickel prices. But prices have continued to be volatile in recent months, falling below $15,000/t in early January from over $18,000/t in October last year, before rebounding to just below $16,000/t in February. Higher nickel prices apply pressure on nickel sulphate producers to raise their prices at a time when the downstream market is expecting affordability, but sub-$18,000/t nickel also stands to disrupt EV adoption by threatening upstream mining that ensures supply security. Nickel needs to find a level that proves profitable for all parts of the EV value chain. A rise in the nickel-free lithium iron phosphate (LFP) chemistry, especially in China, could curb nickel demand globally and render growth rates lower than that for other battery metals such as lithium.
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Nickel demand by application
Forest nickel demand
EVs accounted for 12.3% of global nickel demand in 2024, expected to rise to 15.4% in 2025 and 24.6% in 2034
China imported 126,000t of nickel sulphate in 2023
Global nickel demand for EVs is set to rise by 27% to 530,000t in 2025
EV car battery chemistry global forecast 2021-2034
Nickel sulphate 22% min ex-works China
Indonesian stainless steel production was initially estimated by Argus to rise by a third in 2024, but output fell below expectations after the start-up of a joint project by Chinese giant Lygend and Korean producer Posco was delayed. Indonesia produced 4.4mn t of stainless steel in 2023, Argus estimates show, with output now expected to rise only marginally above that level on a ramp up at PT Obsidian Stainless Steel. But fundamentals are robust in China, where Argus estimates stainless steel output rose by over 5pc to 38.9mn t in 2024. Fiscal support to key end-use sectors could lift stainless steel and consequently nickel pig iron demand, creating upside to nickel prices as the market tightens.
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Stainless steel 304/2B CRC+Sheet 2mm ex-warehouse China
Indonesia produced 4.4mn t of stainless steel in 2023
Argus forecasts nickel consumption in stainless steel production to rise by 16.5% in the next decade reaching 2.46mn t in 2034
China’s stainless steel output increased by 5.4% to 38.9mn t in 2024
Nickel pig iron 10% ex-works China
China stainless steel output by series
The US’ recently announced punitive tariff hikes on Chinese imports include an increase of EV tariffs to 100pc, with EV batteries and parts tariffs also rising to 25pc as the country looks to align its critical raw material sourcing with Inflation Reduction Act (IRA) guidelines. Chinese exports of lithium-ion batteries to the US were valued at $13.55bn in 2023, and an escalation of tensions or a full scale trade war could impact the supply of nickel-based battery materials given no real alternatives are in sight. The US and Japan have also outlined plans to invest in nickel projects in nickel-rich Philippines to cut reliance on China, but China-backed Indonesia remains the only near and medium term growth driver in the nickel market.
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US imports of lithium carbonate and hydroxide were valued at close to $295mn in 2023
Chinese exports of lithium-ion batteries were valued at $64.9bn in 2023
US hikes tariffs on Chinese EVs to 100pc
Indonesia has emerged as a new powerhouse for cobalt, thanks to investment from both Chinese and western companies. It produced around 17,000t of cobalt in 2023, accounting for about 8pc of global supply. And it has so far avoided US president Donald Trump’s attention. Trump announced a 25pc tariff on imports from Canada on 1 February, which was later put on hold for 30 days on 4 Feb. If Trump does not retreat from his initial plan, the 25pc duty will effectively put Canadian-origin cobalt in a similar status as Chinese material, which could significantly cut Canadian shipments to the US. The lack of tariffs on Indonesian cobalt will allow Indonesian supplier to compete with existing brands in the US, although it could take a couple of years for it to become qualified for use in aerospace applications.
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Indonesian Nickel Index (INI) MHP cobalt payable 2-5% fob Indonesia
Democratic Republic of the Congo (DRC) still dominates mined cobalt production, accounting for over 75% of global supply
Indonesia has lifted its cobalt production, almost exclusively in MHP form, by more than 14 times since 2020
China has the largest refining capacity in the world, with around 80% of refined metal coming from China in 2024
Major cobalt producers outside of DRC
The Argus Non-Ferrous Markets service is your trusted source for comprehensive daily non-ferrous market intelligence covering base metals, ferroalloys, rare earths, high temp metals, technology metals, alloys and light metals. The service includes nickel price assessments representative of the various stages of nickel, stainless steel and battery production, from nickel pig iron to NCM batteries, across global markets to ensure you have the latest insight into this rapidly evolving industry. Nickel producers, stainless steel firms, battery makers and recyclers around the world use our indexation-standard assessments to manage price risk in long-term contracts, spot market transactions and cost modelling.
Argus Non-Ferrous Markets
US vac-scrap price chart
Argus plan to launch 6-4 feedstock scrap price in 2025.
Parts manufacturing accounts for nearly half of all scrap generation, with the remainder originating from titanium mills’ internal production, followed by end-of-life scrap.
US titanium scrap imports primarily consist of aerospace or commercially pure grades, while exports mainly represent ferro-titanium quality scrap.
Titanium scrap forms include turnings (sometimes referred to as chips), clips (sometimes referred to as cobbles), feedstock and bulk weldable, and are differentiated by size.
