Posted on 07 Jan 2026
PT Vale Indonesia's temporary suspension of mining operations due to the delayed approval of its 2026 work plan (RKAB) has added to tightening sentiment in the nickel market, helping to push prices sharply higher at the start of the year.
According to LME data, three-month nickel closing prices rebounded strongly from a mid-December low of $14,263/tonne to $17,003/t by 5 January.
Upstream supply concerns have also filtered into the stainless steel market, with one major Indonesian stainless producer raising export offers by $30/t on 6 January before suspending quotations to reassess pricing amid rising raw material costs, Kallanish learns from market sources.
In a filing dated 2 January, the company confirmed that approval for its 2026 RKAB had not yet been issued, meaning the company is not legally permitted to continue mining activities. In line with regulatory compliance and corporate governance requirements, Vale has temporarily halted operations across all of its special mining licence (IUPK) areas until formal approval is granted.
While the company said the delay is not expected to have a material impact on its financial condition and anticipates approval in the near term, the announcement reinforced market concerns over near-term nickel supply availability.
The disruption comes as Indonesia is reassessing production levels to better align supply with domestic processing demand and stabilise prices. The Ministry of Energy and Mineral Resources (ESDM) has signalled that 2026 nickel output will be reviewed as part of revised annual RKAB approvals, with officials stressing the need to avoid excessive supply that could depress prices.
Indonesia now requires miners to submit annual RKAB production plans for approval, and after shortening their validity from three years to one year from 2026, miners must reapply for 2026-2027 quotas.
Indonesia authorities, however, have allowed miners to operate at up to 25% of planned 2026 output until the end of March while approvals are finalised, according to local media reports, but uncertainty remains over full-year production levels.
Source:Kallanish
