On Friday, Shanghai nickel prices reversed previous weak trends, leading gains in China's nonferrous metals sector with intraday surges exceeding 3%, as contract rollovers accelerated. Market drivers include the Indonesian Nickel Miners Association (APNI) revealing that the 2026 Work Plan and Budget (RKAB) may set nickel ore production at approximately 250 million tons—a sharp drop from the 2025 RKAB target of 379 million tons. APNI also disclosed that the Energy and Mineral Resources Ministry plans to revise the nickel commodity benchmark price (HPM) formula in early 2026. A key revision involves pricing nickel-associated minerals (e.g., cobalt) as independent commodities and imposing royalties. These cost-increase expectations fueled today’s nickel price rebound, with further attention on Indonesia’s policy implementation.

Fundamentally, in the traditional supply chain, nickel-iron prices stabilized while stainless steel spot market transactions improved. Social inventories across China’s major stainless steel warehouses (89-warehouse caliber) totaled 1.0636 million tons, down 1.55% weekly. In the new energy sector, raw material prices faced dual pressure from declining nickel prices and year-end discounts, further dragging down price benchmarks. Demand weakened marginally, with ternary precursor production schedules dropping month-on-month in December. Domestic primary nickel inventories resumed accumulation. Thus, the nickel market’s structural surplus persists, with weak demand and high inventories remaining constraints that may cap price gains. While short-term news buoyed prices, actual policy execution warrants monitoring.