Indonesia raises nickel reference price by 1.67% in October 2024

The Indonesian Ministry of Energy and Mineral Resources (ESDM) set the nickel reference price at US$16,175.23 per dry metric tonne (dmt) in October 2024.

This is a 1.67% increase from September 2024's price of US$15,908.1 per dmt.

Compared to the year-to-date (ytd) average, the October 2024 reference price is down 1.18% from January 2024's US$16,368.86 per dmt.

A decrease is also observed year-on-year (yoy). The October 2024 reference price is down 19.88% from October 2023's US$20,190 per dmt.

This reference price was established through Indonesian Minister of Energy and Mineral Resources Decree (Kepmen ESDM) Number 277.K/MB.01/MEM.B/2024 concerning the Reference Price for Metal Minerals and Coal for October 2024, on October 24, 2024.

Carbon Emissions from Nickel Production

The government's efforts to encourage more massive nickel downstream processing potentially increase Indonesia's carbon emissions due to the ongoing reliance on coal-fired power plants (PLTU) in nickel production operations. According to Katadata, the planned production increase from four major Indonesian nickel companies is predicted to increase carbon emissions by 38.5 million tons of CO2 in 2028.

These four nickel companies are PT Aneka Tambang (Antam) Tbk, PT Merdeka Battery Materials (MBMA) Tbk, PT Trimegah Bangun Persada (Harita Nickel) Tbk, and PT Vale Indonesia Tbk. This was revealed in a recent report by the Institute for Energy Economics and Financial Analysis (IEEFA), *Indonesia's Nickel Companies: The Need for Renewable Energy Amid Increasing Production*.

The report reveals that Antam, MBMA, Harita, and Vale, representing 26% of Indonesia's nickel production, produced 350,000 tons of nickel metal last year, with greenhouse gas (GHG) emissions reaching 15 million tons. In the same year, these four companies earned a profit of US$996 million and revenue of US$6.8 billion.

These four companies plan to increase their total production capacity to 1.05 million tons of nickel metal by 2028.

"As Indonesian nickel companies enjoy growth in profits and business scale, with plans to more than double production in the next 3-5 years, it's time to accelerate the transition away from coal," said Ghee Peh, author of the report and IEEFA Energy Finance Analyst, quoted on Friday (October 25, 2024).

(Read Katadata: Increased Production from 4 Indonesian Nickel Companies Potentially Boosts Emissions by 38 Million Tons)