Nickel prices on the London Metal Exchange surged as much as 2.6% to $19,050 a ton after Shanghai Metals Market said upwards of 15% of high-grade nickel pig iron capacity at Indonesia's Weda Bay Industrial Park will undergo rotational maintenance in the coming months, according to Bloomberg.
Indonesia's Weda Bay Industrial Park is one of the most important nickel-processing hubs in the world and serves a large cluster of smelters that produce nickel pig iron, a key input for stainless steel production.
Indonesia dominates global nickel supply, producing 2.6 million metric tons of nickel in 2025 out of a global total of 3.9 million tons, accounting for roughly two-thirds of global mine production.
So, the earlier news from SMM indicating a 10% to 15% reduction in NPI output from Weda Bay Industrial Park in the coming months, building on existing NPI reductions in March and April due to lower ore supplies and high costs, has easily sparked supply concerns on the LME ...
Nickel is extremely valuable and a critical industrial metal in the era of electrification and data center buildouts:
Stainless steel, by far the largest demand center, where nickel improves corrosion resistance, strength, and heat tolerance.
EV and energy-storage batteries, especially nickel-rich lithium-ion chemistries that increase energy density and driving range.
Aerospace and military superalloys, including jet-engine turbine blades and high-temperature gas turbines.
Industrial alloys, plating, and catalysts, used across machinery, chemicals, and corrosion-resistant equipment.
Let's not forget that sulfuric acid prices have surged amid the Hormuz disruption. This industrial chemical is used in nickel production, especially in Indonesia's battery-grade nickel supply chain.
The line in the sand for LME nickel futures is $20,000.