Indonesia has ordered output cuts at PT Weda Bay Nickel, the world’s biggest nickel mine, by sharply reducing its ore production quota for 2026 in a move designed to support global nickel prices.
The mining firm has been told it will receive a 2026 ore production quota of 12.0 million tons, down from 42.0 million tons in 2025, according to people familiar with the matter.
Nickel futures advanced in London following the quota news, signaling that traders interpreted the constraint as immediately supportive for benchmark pricing.
Weda Bay Nickel operates on Halmahera island in North Maluku province, an Indonesian mining hub that has become central to global nickel supply chains. The mine is owned by Tsingshan Holding Group, Eramet, and PT Aneka Tambang.
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In a statement, Eramet confirmed the size of the reduction in Weda Bay Nickel’s quota and said the company intends to apply for a revision.
The quota described is in tons of ore, not refined nickel units, so the immediate restriction is upstream at the mining stage. Even so, ore constraints can tighten the entire value chain when the constrained asset is a primary feed source for downstream processing capacity.
This comes after PT Vale Indonesia halted nickel mining operations early this year 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.
Late last year, Indonesia announced plans to slash nickel production by a third in 2026 as it seeks to halt a two-year price decline that has shuttered mines globally, reducing its mining quota to 250 million tonnes, down 34% from current levels.
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