World nickel prices suddenly went up. Metal rose in price by more than 5% due to uncertainty around production in Indonesia and general tension in commodity markets.
In the first week of January 2026, nickel on the London Metal Exchange added more than 5% and reached $17.8 thousand per ton. Analysts attribute the rise in nickel prices primarily to the situation in Indonesia, which provides about 60% of global production.
The Indonesian authorities plan to reduce quotas for nickel ore production in 2026 by a third. Additionally, there are plans to move to annual licenses instead of long-term permits to curb oversupply. These measures have increased market concerns about the stability of future supplies.
Short-term risks also arise from production restrictions at two PT Vale Indonesia mines, where issuance of licenses for 2026. At the same time, the growth in quotations is partially restrained by an increase in nickel reserves in LME warehouses, which over the week grew by more than 11% and approached 285 thousand tons.
The market was also supported by the general dynamics of non-ferrous metals. Copper prices have risen above $13,000 per tonne due to geopolitical tensions and concerns over the supply of raw materials. Experts note that instability increases the desire of countries and companies to provide themselves with strategic resources in advance.
An additional factor was the European Commission’s investigation into Anglo American’s plans to sell nickel assets to the Chinese company MMG. Brussels fears risks to the supply of ferronickel to the European metallurgy.
Despite the growth in quotes, the fundamental situation remains difficult. From 2022 to the end of 2025, nickel fell in price by about 40% due to a sharp increase in production in Indonesia. Norilsk Nickel, which controls about 16% of the world market, expects that in 2026 the nickel surplus will exceed 200 thousand tons. The company notes that even taking into account possible disruptions, demand has not yet compensated for the expansion of supply.
Analysts believe the nickel market will grow due to demand from manufacturers of stainless steel, electric vehicles and energy storage systems. However, in 2026, Indonesian politics, geopolitics and the balance between excess supply and moderate consumption growth will remain key factors.
Source: Kommersant
Photo: Ajeng Dinar Ulfiana
