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查看配图：Voisey's BayAn underground mine at Voisey’s Bay, Newfoundland and Labrador. Credit: Vale
The global nickel market is heading for another surplus this year, reversing an earlier forecast for a shortage, the International Nickel Study Group says.
Production is forecast at 3.87 million tonnes against demand of 3.85 million tonnes in 2026, leaving a 19,000-tonne surplus. The excess is expected to widen to 70,000 tonnes next year, the Lisbon-based intergovernmental body said in its October outlook issued Tuesday.
“Nickel’s role in the battery market has also grown more gradually than anticipated,” the group said. “It faces competition from lithium iron phosphate chemistries.”
The reversal reflects a larger upward revision to expected supply than demand for the metal, widely used in stainless steel production and in electric vehicle batteries. INSG raised its production forecast by 153,000 tonnes and its consumption forecast by 102,000 tonnes from April, when it projected a deficit of 32,000 tonnes. April’s outlook had put production at 3.71 million tonnes and consumption at 3.74 million tonnes.
Output unchanged
This year’s expected surplus remains well below the 299,000 tonnes estimated for 2025. Demand is forecast to grow 7.6% this year while production is almost unchanged. In 2027, output is expected to reach 4.07 million tonnes against consumption of 4 million tonnes.
Indonesia’s expansion has reshaped nickel supply. Chinese-backed projects have increased their capacity to produce materials for stainless steel and batteries, INSG said in an earlier market review. The group estimated in October 2025 that Indonesia accounted for two-thirds of global nickel mine output that year.
Indonesia approved a significantly lower nickel ore mining quota for 2026 than for 2025, although permit holders could seek an upward revision subject to the government’s assessment of supply and demand, INSG said in April.
Canadian producers are also part of the supply picture. Vale (NYSE: VALE) reported 10,400 tonnes of finished nickel from its Voisey’s Bay operations in the second quarter, up 1,800 tonnes from a year earlier as underground ore output increased. Sudbury contributed 6,700 tonnes, down 1,900 tonnes because of planned maintenance, the company said in its production update.
Glencore (LSE: GLEN; JSE: GLN; ASX: GLC), whose nickel business includes operations in Canada and Australia, produced 35,800 tonnes from its own sources in the first half and maintained full-year guidance of 70,000 to 80,000 tonnes, it said in its half-year report.
The consequences of oversupply are visible at BHP (ASX, NYSE, LSE: BHP), whose remaining Western Australia Nickel assets are suspended. The company agreed this month to sell its Kambalda nickel concentrator to Gold Fields (NYSE, JSE: GFI)and plans to review the wider suspension by February 2027, considering options including a restart, further asset sales or closure, BHP said in an Oct. 7 statement.
Stainless steel provides a source of demand growth. Global output rose 5% to about 33 million tonnes in the first half, the Brussels-based World Stainless Association said in an August release. Asian production increased 6.1%, while European Union output fell 3.7%.
Battery competition
Lithium iron phosphate (LFP) batteries accounted for more than 55% of global electric vehicle battery deployment in 2025, up from nearly 50% a year earlier, the Paris-based International Energy Agency said in its EV outlook for this year. The chemistry offers an alternative to nickel-bearing batteries.
The shift remains uneven. Nearly 80% of EV batteries deployed outside China last year used nickel-containing chemistries, the agency said.
INSG cautioned that its forecasts remain uncertain, particularly for Indonesian production, and don’t include an allowance for possible production disruptions.