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Indonesia’s nickel output seen at 1.65 mln to 1.75 mln T in 2023- govt official

Indonesia’s annual nickel products output is expected to reach 1.65-1.75 million metric tons this year, a government official said on Wednesday.

Indonesia is the world’s top producer of nickel ore and products, which come in forms such as nickel pig iron (NPI) that is used to make stainless steel or mixed hydroxide precipitate (MHP), a feed material for electric vehicle batteries.

The country’s primary nickel production rose 32% to 1.16 million tons last year, accounting for 38% of the global output, International Nickel Study Group data showed.

Production capacity of nickel products this year is estimated at 2.2 million tons, said Septian Hario Seto, a deputy minister in Indonesia’s Coordinating Ministry for Maritime Affairs and Investment.

Capacity for NPI and nickel matte is seen at 1.94 million tons, and MHP capacity is estimated at 265,000 tons, data from Septian’s presentation slides at the Fastmarkets China Battery Raw Materials Conference in Shanghai showed.

“We have a huge capacity. We don’t need to expand further,” he said, adding, smelters that do not have their own mines are going to face difficulties amid tightening ore supply and declining ore grade.

Septian said the government is not issuing new permits for NPI plants, but still encourages high pressure acid leach (HPAL) projects that make MHP.

The NPI smelters currently under construction this year were approved in 2022, he said.

PRICE INDEX

The Indonesia government has had plans to establish a new nickel price index this year, while some private price reporting agencies have launched indices for Indonesia nickel in recent months, a trend that could change the metal pricing mechanism.

Septian said the government would not pick up any particular index from the private providers but would assess the accuracy of these indices in the next three to four months.
Source: Reuters (Reporting by Siyi Liu in Shanghai, Mai Nguyen in Hanoi and Bernadette Christina in Jakarta; Editing by Jacqueline Wong, Varun H K and Rashmi aICH)

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