Business · Energy & Commodities · 11 hrs ago
Indonesia pushes nickel processing towards finished products as demand grows
Global nickel demand is forecast to grow 21.39% by 2031, driven mainly by batteries and stainless steel.
The projection rises from 3.717 million tonnes in 2026 to 4.512 million tonnes in 2031.
Indonesian industry leaders say the country should use that growth to make finished products, rather than stopping at partly processed nickel.
More downstream production could bring greater value to local suppliers and industries by drawing more of the supply chain into Indonesia.
State-linked companies are developing a battery plant in Karawang, with initial capacity of 6.9 gigawatt-hours and plans to expand to 15 gigawatt-hours.
A project in the Weda Bay industrial area in North Maluku also combines production of nickel-based battery materials, batteries, electrolytic aluminium and electric heavy equipment.
The government is considering a pause on smelters that make only intermediate products, partly to address a global nickel oversupply estimated at about 2.5 million tonnes and encourage production of finished goods.
Global nickel demand is projected to rise 21.39%, from 3,717 kilotons in 2026 to 4,512 kilotons in 2031, according to Shanghai Metals Market.
Battery and stainless steel industries are expected to drive the increase.
Indonesian industry figures say the country should expand processing to finished products to capture more value and involve local suppliers.
The government is considering a moratorium on smelters that produce only intermediate goods, partly to address a global nickel oversupply of about 2.5 million tons.
Projects in Karawang and Indonesia Weda Bay are developing parts of an integrated battery supply chain.
- Who
- Indonesia’s government and nickel industry figures, including Imaduddin Abdullah, Rachmat Makkasau and Bahlil Lahadalia.
- What
- Indonesia is pushing nickel processing towards finished products as global demand is projected to grow.
- When
- The article was published on October 18, 2026. Bahlil discussed a possible smelter moratorium on October 17.
- Where
- Indonesia, including battery projects in Karawang and the Indonesia Weda Bay Industrial Park in Central Halmahera, North Maluku.
- Why
- To capture more value domestically, strengthen local supply-chain links and help manage global nickel oversupply.
This story does not have two clearly opposing sides.
Shanghai Metals Market projects global nickel demand will rise from 3,717 kilotons in 2026 to 4,512 kilotons in 2031.
Bahlil Lahadalia said the government was studying a moratorium on smelters that produce only intermediate products.
CNBC Indonesia published the report on Indonesia’s push to process nickel into finished products.
- Projected demand growth
- 21.39% from 2026 to 2031
- Global nickel demand
- 3,717 kilotons in 2026; 4,512 kilotons in 2031
- Karawang battery plant
- Initial capacity of 6.9 GWh, with expansion targeted to 15 GWh
- Global nickel oversupply
- About 2.5 million tons
- Indonesia Weda Bay Industrial Park
- Central Halmahera, North Maluku
What people are saying
This increase in global nickel demand is a major opportunity for Indonesia. The key is to deepen processing through to finished products, not stop at intermediate products.
Higher added value is in downstream industry. Our main task is actually to promote the growth of downstream industry in Indonesia.
What we want from downstreaming is for the final 100% of added value to be here, in the country.