Nickel prices have recorded a decline, although they have started to rise in the past month.

According to Trading Economics, on Wednesday (13/3), nickel prices fell 20.07% on an annual basis. However, nickel prices have risen 14.49% in the past month to USD 18,325 per ton.

Some nickel issuers are also concerned about this. One of them is PT Trimegah Bangun Persada Tbk (NCKL) or Harita Nickel.

Investor Relations of NCKL Lukito Gozali sees the volatility of nickel prices, which is influenced by these factors, such as global geopolitical tensions, increased production capacity, the dynamics of the electric vehicle (EV) market, and the global economic conditions.

NCKL also sees this condition as a challenge and opportunity. Harita Nickel is optimistic that nickel prices will return to stability even strengthening in 2024-2025.

"Strengthening nickel prices is supported by estimates of global economic recovery and increased demand for nickel, especially from the electric vehicle battery industry and stainless steel production," he told Kontan on Wednesday (13/3).

Based on NCKL calculations, the increase in electric car sales could reach 27 million units per year by 2026. On the other hand, there is a projected growth in global stainless steel production in the next few years.

"This gives us the confidence that demand for nickel, especially for electric vehicles and stainless steel, will continue to increase. We are also still investing in developing production capacity and operational efficiency," he explained.

NCKL targets ferronickel production in 2024 of 120,000 tons of nickel content in ferronickel.

The figure is achieved through two Rotary Kiln-Electric Furnace (RKEF) smelters that are fully operational. They are PT Megah Surya Pertiwi (MSP), with an installed capacity of 25,000 tons of nickel content in ferronickel, and PT Halmahera Jaya Feronikel (HJF), with an installed capacity of 95,000 tons of nickel content in ferronickel.

Meanwhile, mixed hydroxide precipitate (MHP) products through PT Halmahera Persada Lygend (HPL) have an installed capacity of 55,000 tons of nickel content in MHP.

MHP production will increase after the operation of PT Obi Nickel Cobalt (ONC), which has an installed capacity of 65,000 tons of nickel content in MHP.

"ONC production will be in the range of 20,000 tons - 30,000 tons, along with the operation of three MHP production lines, which will be carried out in stages throughout 2024," he said.

Lukito explained that NCKL continues to focus on increasing the added value of nickel derivative products. Therefore, the company appreciates the government's commitment to downstream on Obi Island, which has now been designated, as a National Vital Object and National Strategic Project.

"We hope that government support and incentives will continue to encourage the growth of downstream and nickel industrialization," he explained.

Image source: KONTAN / Ardian Taufik Gesuri
Source: https://investasi.kontan.co.id/news/harga-nikel-tertekan-simak-strategi-trimegah-bangun-persada-nckl