PT Vale Indonesia halted nickel mining operations on Friday after Indonesian authorities failed to approve the company’s 2026 production plan, though the joint venture expects to resume work soon.
The suspension affects the company’s Pomalaa and Bahodopi mines, while operations continue at the flagship Sorowako facility, according to market sources. The company projects output will operate at roughly 30% of normal capacity during the stoppage.
Vale Indonesia, a partnership between Brazil’s Vale SA and the Indonesian government, informed the stock exchange that the delay “will not disrupt overall operational sustainability” and expects the authorities to issue the 2026 approval “in the near future.”
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Indonesian law requires all mining companies to submit annual production plans, known as RKAB, for government approval. Officials set output quotas for the industry each year.
Deputy Mining Minister Yuliot Tanjung told reporters the approval was “currently being consolidated” but declined to specify the planned quota.
Mining Minister Bahlil Lahadalia announced last week that the government would reduce mining output quotas to support commodity prices and increase government revenues.
The suspension comes as Indonesia’s nickel smelter association forecasts domestic demand will reach 340 million to 350 million metric tons in 2026, representing an annual increase of up to 50 million tons.
Nickel prices surged toward the end of 2025 on expectations that Indonesia, the world’s largest nickel producer, would cut output quotas. The timing affects Vale Indonesia’s expansion plans, which include major downstream processing projects worth approximately $8.5 billion across three sites.
Vale Indonesia had delivered strong operational results through the third quarter of 2025, with nine-month nickel matte production reaching 54,975 metric tons, up 4% year-over-year.
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