Nickel rose for a fourth straight session on Wednesday after the world’s biggest nickel mine in Indonesia received a sharply reduced output quota for this year.
Benchmark three-month nickel on the London Metal Exchange was up 2.1% to $17,860 per metric ton as of 1000 GMT. The metal used to make stainless steel and rechargeable batteries earlier jumped as much as 2.8% to $17,980, its highest since January 30.
French miner Eramet on Wednesday said its PT Weda Bay Nickel venture with China’s Tsingshan and Indonesia’s PT Antam had received an initial production allowance of 12 million wet metric tons for 2026, down from 32 million wet tons for 2025. The venture will apply for an upward revision, it added.
After a prolonged period of depressed prices, nickel has gained around 18.6% over the past three months and hit a more than three-year high on January 25 as Indonesia, the world’s biggest producer of nickel ore, vows to reduce supply.
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“It’s clear that Indonesia is realising its pricing power,” said WisdomTree commodity strategist Nitesh Shah, noting that the roughly 60% of global nickel production the Southeast Asian country controls made it “more powerful than OPEC” in oil.
“It has recognised that it doesn’t need to overproduce to make decent revenue,” Shah added.
Even so, the International Nickel Study Group has forecast a 261,000 ton surplus this year, and the LME Futures Banding Report showed one entity has a short position on the February nickel contract accounting for 20%-29% of open interest.
Other base metals also gained ground as the dollar softened, making greenback-priced commodities more affordable for investors using other currencies.
Copper was up 1.2% to $13,266.50 a ton as top consumer China prepares to shut down for the Lunar New Year holiday. Aluminium gained 1.1% to $3,127.50 a ton, zinc added 1.4% to $3,442.50 a ton, lead edged up 0.6% to $1,985 a ton and tin jumped 2.8% to $50,700 a ton.
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