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Informist, Tuesday, Jan. 6, 2026

 

MUMBAI – Fitch Solutions company BMI has lowered its price forecast for nickel in 2026 to $15,500 per tonne from $16,000 per tonne, with prices set to remain range-bound due to a persistent global supply glut. The market surplus is expected to widen modestly to around 250 kilotonnes this year from 244 kilotonnes estimated in 2025 as Indonesia continues to add capacity, despite execution risks arising from recent policy changes. Indonesia is the world's largest producer of the metal.   

 

"That said, even with significant downside risks, emerging supply–demand supports are likely to put a floor under prices, preventing a repeat of the sharp falls seen over the past three years," the report said. The nickel market is expected to remain in surplus. However, strong demand from China's net zero-linked and stainless steel sectors is likely to partially offset the widening surplus, it said.  

 

Demand for nickel is expected to strengthen in 2026, rising 4.9%, against 4.5% in 2025, underpinned by improving macro conditions, solid consumption from sectors aligned with the net-zero transition, and stable stainless steel demand. Demand from stainless steel industries is also set to remain strong as top producer China continues to ramp up output. Global nickel consumption is likely to rise to 7 million tonnes by 2034 from 3.5 million tonnes in 2025, averaging annual output growth of 7.5?tween 2025 and 2034, the report said. 

 

However, growth in production of nickel batteries has lagged earlier expectations due to a shift towards non-nickel battery chemistries, which are cheaper, safer, and offer a longer life cycle. This trend is expected to dampen demand growth in 2026 and beyond, the report said.

 

On the supply side, Indonesia is expected to drive global production growth and remain the top refined nickel producer for a longer period of time. Indonesia's output is likely to rise to 4.2 million tonnes by 2034 from 1.7 million tonnes in 2025. However, policy changes by the Indonesian government and weak nickel prices could pose risks to supply growth, the report said. "Indonesia's low-cost production will continue to pressure operators in 2026, prompting cutbacks of uneconomic operations and postponements of new projects," it said. 

 

For the long term, the nickel market is likely to stay in surplus through 2030 as Indonesia's rapid capacity expansion continues to outpace strong growth in clean energy-related nickel demand. However, "we note downside risks due to the growing adoption of alternative battery chemistries," it said.  End

 

US$1 = INR 90.17

IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT

 

Reported by Udita S. Jaiswal

Edited by Avishek Dutta

 

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