Indonesia Plans Major Nickel Production Cut in 2025 to Boost Prices

While the reduction in production could help stabilize the global nickel market and raise prices, it may also hinder the development of Indonesia’s downstream nickel industry. This sector, which focuses on processing nickel into more valuable products, is crucial for reducing the country’s reliance on raw material exports and creating higher-value jobs.

Indonesia has long been looking to develop its downstream industries, particularly in sectors such as electric vehicle (EV) battery production, where nickel plays a vital role. However, the country has faced challenges in transitioning from raw material extraction to value-added manufacturing. The government’s proposed production cuts could slow the growth of this strategic sector.

As Indonesia looks to manage its vast nickel reserves more sustainably, the decision to limit production may help balance market conditions, but it also highlights the need for greater investment in downstream industries. The country’s ability to add value to its natural resources will be key to ensuring long-term economic growth and industrial diversification.

While the reduction in nickel production in 2025 may help improve prices and conserve reserves, it raises important questions about Indonesia’s industrial future. The challenge lies in fostering a more sustainable and value-added mining industry, while also supporting the growth of downstream sectors that can generate greater economic benefits. (Uki Ruknuddin)