The global nickel market is entering a policy-driven phase after Indonesia sharply reduced its 2026 mining quota to around 260-270 million tons, down from 379 million tons last year. The tighter supply outlook has triggered a structural rebound in prices, with analysts forecasting a firm trend from 2026 to 2028 amid policy tightening and growing new energy demand.

In the first half of 2026, as Indonesia’s quota cuts take effect, LME nickel is seen testing levels above US$18,500 per ton. Prices recently approached US$18,000 before closing at about US$17,844 last week. For the full year, nickel is expected to trade between US$15,500 and US$22,000 per ton, averaging US$17,000-18,000. 

The rally has also lifted nickel pig iron, a key raw material for stainless steel, to recent highs. Analysts cite tightening Indonesian supply, long-term contract structures limiting spot availability, and continued double-digit growth in battery-grade nickel demand as key supports for the market.