Nickel futures climbed to $17,900 per tonne in February, rebounding after a speculative rally earlier this year had driven prices to a 19‑month high of $18,785, amid expectations of tightening supply. The Indonesian government announced that nickel ore production quotas will be cut by more than 100 million tonnes from the previous year, capping output at 270 million tonnes in 2026. This move came after major miners in the Weda Bay area signaled they would sharply reduce production, reinforcing Jakarta’s policy shift and undermining any prospect that large producers could still negotiate higher quotas, a possibility long supported by ambiguity over limits on wet tonnes.
Previously, Indonesian authorities had also indicated they would intensify their crackdown on illegal mining, amplifying the impact of lower supply. At the same time, prices have continued to find support from commodity funds. Nickel’s key role in data centers and electrification technologies has made it a favored vehicle for speculative bets on artificial intelligence–related demand, further underpinning the market.
