en.Wedoany.com Reported - The London Metal Exchange (LME) nickel benchmark price closed at $16,587 per metric ton, up 1.52% on the day. Total LME opening stocks stood at 274,584 metric tons, with canceled warrants at 16,650 metric tons. Combined LME and Shanghai Futures Exchange (SHFE) nickel inventories totaled 375,000 metric tons, accounting for approximately 9% of 2025 mine production. Global nickel inventories totaled 497,000 metric tons.
Indonesia's mid-year RKAB revision could raise the 2026 nickel ore quota from the initially set 260 million to 270 million wet metric tons to 300 million to 350 million wet metric tons. An increase in the quota would imply higher ore supply and exert pressure on nickel prices. A more substantial quota increase would alleviate ore shortages, following WBN's production halt due to the exhaustion of its 2026 quota. Indonesia's long-term nickel price target of $19,000 to $20,000 per metric ton limits its room to raise the quota.
Disruption of shipping through the Strait of Hormuz has caused the CIF price of sulfur delivered to Indonesia to surge from below $600 per metric ton to $1,300 per metric ton. This supply shock has directly pushed up production costs for the High-Pressure Acid Leach (HPAL) process and triggered output cuts, with Huayou Cobalt's Huafei Nickel-Cobalt project already adjusting production accordingly. HPAL consumes approximately 10 metric tons of sulfur per metric ton of nickel in MHP production, making sulfur costs a key driver of the price surge in May.
Global nickel miner C1 cash cost estimates at the 75th and 90th percentiles for 2026 have risen to $17,870 per metric ton and $18,650 per metric ton, respectively. This cost level is higher than the current spot nickel price of $16,587 per metric ton, and significantly above the 2025 levels of $14,650 per metric ton and $15,300 per metric ton. Due to high sulfur prices, RKEF-based high-grade nickel matte operations hold a cost advantage over sulfur-dependent HPAL facilities. In the first half of the year, Indonesia's high-grade nickel matte production surged 123% year-on-year to 185,000 metric tons of nickel content, while HPAL producers continue to face margin pressure at current spot prices.
Shanghai Metals Market (SMM) outlined three scenarios for nickel price trends in the second half of the year: In a bearish scenario, LME nickel prices are expected between $14,000 and $16,000 per metric ton, contingent on a quota increase of at least 30% and a decline in sulfur prices; in a neutral scenario, the price range is $15,500 to $17,500 per metric ton; in a bullish scenario, the price range is $17,000 to $19,000 per metric ton, contingent on tight quotas and rising sulfur costs. The spot nickel price of $16,587 per metric ton sits at the midpoint of the neutral range, indicating that the market is pricing in a moderate quota increase. Bernstein has raised its 2026 nickel price target to $17,357 per metric ton, aligning with the upper end of the neutral scenario.
