Wedoany.com Report on Feb 2nd, Nickel prices on the London Metal Exchange (LME) have retreated after hitting an 18-month high. In the week ending January 30, the average LME nickel price was $17,700 per tonne, down approximately 6% from $18,860 the previous week. The price decline is mainly attributed to ample global supply and high exchange inventories.

Nickel inventories monitored by the LME stood at 286,284 tonnes, slightly up 1% from a week earlier, remaining at historically elevated levels. Market analysis suggests that the inventory surplus is putting pressure on price increases, while slowing growth in stainless steel demand is also limiting the upside for nickel prices.

Indonesia's nickel supply situation is drawing significant attention. Reports from PT Aneka Tambang Tbk show that nickel ore production reached 16.11 million wet metric tonnes in 2025, with sales of 14.58 million wet metric tonnes, both setting new highs in recent years. PT Vale Indonesia confirmed that construction of its Pomala project smelter is progressing as planned, with large-scale mining operations expected to begin in 2026.

Despite Indonesia's plans to adjust nickel ore production quotas in 2026, concerns about a supply surplus persist. Analysts point out that the short-term upward momentum for nickel prices may weaken, with fundamental factors indicating limited upside potential. Excess supply remains a primary factor influencing market sentiment.