Source: Bisnis.com | November 20, 2025

The Indonesian Nickel Industry Forum (FINI) expressed concerns regarding low nickel demand for electric vehicle (EV) batteries amidst oversupply at smelters.

FINI Chairman Arif Perdanakusumah stated that demand for nickel for batteries increased by 10% from 2020 to 2022. However, demand growth has declined by 1% per year over the past two years.

“So, our estimate is that even by 2030, nickel demand for batteries will not exceed 20%. This will likely be a challenge and a topic for discussion with the government regarding our MHP products in the future,” Arif said at the Bisnis Indonesia Forum (BIF), Thursday (November 20, 2025).

MHP, or mixed hydroxide precipitate, nickel products are a crucial raw material in the EV battery production supply chain. MHP is generally produced from low-grade nickel processing using high pressure acid leaching (HPAL) technology.

Currently, there are three HPAL smelters operating in Indonesia with an installed annual capacity of 445,000 tons. Arif projects an additional 30,000 tons of MHP production in the near future.

According to the Ministry of Investment and Downstream Investment Coordinating Board (BKPM), HPAL smelters are growing expansively, with 22 refining facilities currently under construction. With this project, by 2027, the production will reach 450,000 tons, doubling the current capacity.

“So, the increase is approximately twofold, so by the end of 2027, Indonesia’s estimated MHP production will be around 940,000 tons,” he said.

Meanwhile, nickel production from rotary kiln electric furnace (RKEF) smelters has reached 2.5 million tons from a total of around 170 smelter companies in Indonesia.

On the other hand, the nickel industry also faces challenges due to its dependence on the stainless steel sector as the primary nickel supplier. Furthermore, there is competition from non-nickel battery technology, such as lithium ferrophosphate (LFP). “Furthermore, economic growth, war in the Middle East, and the Russia-Ukraine conflict, among other factors, have led to a decline in global nickel demand, leading to oversupply and price pressure,” he concluded.