LME nickel futures jumped to $18,806 per tonne after SMM reported that 10-15% of high-grade NPI capacity at Indonesia's Weda Bay Industrial Park will undergo rotational maintenance. Weda Bay produces approximately 40,000 tonnes of contained nickel per month, making it the single most important NPI hub globally.
The maintenance cuts compound existing tightness from Indonesia's ore quota policy. The government cut the 2026 ore quota to 250-260 Mt from 379 Mt in 2025 - a 34% reduction. Ore shortages forced some NPI producers to curtail output since March-April, with high costs and power reallocation to aluminum further tightening conditions.
Despite the rally, ING projects a global surplus of 261kt in 2026 after 209kt in 2025. The market is bipolar: abundant low-grade NPI versus tighter high-purity Class 1 nickel. Indonesia's active supply management through quota policy is the key swing factor.