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Nickel prices have been sliding down recently, largely due to an increase in nickel ore supply and the steady buildup of refined nickel inventories. This trend has pushed prices closer to production costs. Between September 1 and September 6, 2024, spot nickel prices saw a slight decline, which led to improved downstream transactions and small adjustments in premiums and discounts across various nickel brands. During this period, LME nickel stocks rose by 2,718 tons, bringing the total to 121,716 tons, while global refined nickel inventories grew by 3,429 tons to 157,695 tons. As Indonesia ramps up its production capacity, the market is expected to maintain a stable supply, keeping nickel prices steady in the short to medium term.

The ongoing increase in production capacity continues to put downward pressure on nickel prices. Spot prices have fallen slightly, helping downstream transactions and causing minor fluctuations in the premiums and discounts across nickel brands. Hario Seto, Indonesia's Deputy Minister for Maritime Affairs and Investment, spoke at an industry summit, forecasting that London Metal Exchange (LME) nickel prices will likely stabilize between $15,000 and $16,000 per tonne in the near future. He also noted that approximately 928,000 tonnes of new production capacity will be added each year for the next three years, primarily driven by demand from the electric vehicle industry.

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Looking ahead, nickel prices are expected to remain rangebound over the next few months. The seasonal increase in demand, particularly from the construction sector in the fall, may be offset by the added production capacity, keeping the market relatively balanced.