Nickel

Current status

Nickel markets face heightened geopolitical risk with 474 security events recorded over the past 30 days, including 276 critical-severity incidents concentrated across key supply chain regions. Military escalation in Russia and East Asia, combined with wildfire activity in China, has driven spot prices up 9.8% to $25,430 per ton. The severity and geographic spread of disruptions across major producing and processing countries signals elevated supply chain vulnerability.

Supply chain impact

• Stainless steel manufacturers face immediate exposure as 70% of nickel demand serves this sector, with Russian supply disruptions affecting European and North American steel producers who rely on refined nickel imports.
• EV battery supply chains are critically vulnerable through Indonesia's Sulawesi smelting operations and East Asian battery-cell manufacturing, where Chinese wildfires and regional military activity threaten the 85% of global battery production capacity concentrated in China, South Korea, and Japan.
• Tesla, CATL, and other major battery manufacturers dependent on Indonesian nickel processing face potential production delays as alternative sources lack the processing capacity and cost advantages of Sulawesi's Chinese-funded smelters.
• Aerospace and marine equipment manufacturers using high-grade nickel alloys confront supply constraints from Russian sanctions and potential processing disruptions in Asia.
• Philippines nickel ore exports to China face heightened logistics risk amid regional military tensions, potentially forcing buyers toward higher-cost alternative suppliers in Canada and New Caledonia.

Watch points

• Monitor Indonesia's nickel export policies and any new processing restrictions that could further tighten refined nickel availability, particularly given the country's history of sudden ore export bans.
• Track escalation of military activities in East Asia that could disrupt battery manufacturing in China, South Korea, and Japan, as alternative production capacity remains extremely limited globally.
• Watch for extended wildfire activity in China affecting nickel processing facilities and transportation networks, as this could compound existing supply pressures from geopolitical tensions.