Govt to revise nickel benchmark pricing, cobalt to face royalties: APNI

The Ministry of Energy and Mineral Resources (ESDM) plans to revise the benchmark mineral price (HPM) formula for nickel in early 2026, a move that is expected to introduce royalties on associated minerals such as cobalt, the Indonesian Nickel Miners Association (APNI) said.

APNI Secretary General Meidy Katrin Lengkey said the revised formula is targeted for issuance in January or February 2026 and will treat associated minerals as standalone commodities.

“Cobalt already has downstream products such as cobalt sulphate, so it should not be treated as a free by-product,” Meidy said, as quoted by Bloombergtechnoz.com, adding that the new formula is expected to benefit miners while increasing state revenue.

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APNI has proposed that the government focus on imposing royalties on associated minerals rather than raising progressive royalty rates on primary nickel ore. Although cobalt content in nickel ore averages only about 0.1%, Meidy said its high value could generate up to US$600 million in additional state revenue if royalties are applied.

Government documents from ESDM’s Directorate General of Minerals and Coal show that cobalt has been proposed for a single royalty rate of 1.5%, while cobalt produced as a by-product of nickel matte would face a 2% royalty. However, APNI has warned that the absence of a clear pricing formula for cobalt ore could complicate implementation.

Under Government Regulation No. 19/2025, royalties on nickel ore are set at 14%–19%, while processed products such as ferronickel and nickel pig iron are subject to rates of 4%–7%.

APNI said it supports Indonesia’s downstreaming agenda and urged the government to ensure fiscal policies promote a competitive and sustainable mining industry.

Editing by Reiner Simanjuntak