Core facts
As Indonesia's high-grade laterite nickel ore resources continue to be depleted, the average ore grade keeps declining. The market expects Indonesia's average nickel ore grade to fall by about 4%-5% further in 2026. For example, while market transactions may be priced based on Ni 1.50% ore, the actual delivered ore grade may be only around Ni 1.43%-1.44%.
Inventory and logistics
Although the grade decline appears limited, lower ore grades mean that producing the same amount of nickel metal requires mining and processing more ore, raising the stripping ratio and mining costs and further intensifying competition among RKEF and HPAL smelters for high-grade nickel ore resources. High inventories continue to cap nickel price gains.