By Dominikus
Indonesia aims to reach US$50 billion in annual nickel-related exports by 2045, driven by an aggressive shift from raw material exports to higher value-added processing industries. The target was conveyed by Luhut Binsar Pandjaitan, Chairman of Indonesia’s National Economic Council (DEN), during his remarks at the International Conference on Infrastructure (ICI) 2025 in Jakarta last week.
Luhut highlighted how the country’s controversial ban on nickel ore exports more than a decade ago had transformed its economic trajectory. “Our nickel ore exports were worth just US$1.3 billion ten years ago. Last year, with downstream industries in place, we reached around US$34–35 billion. I believe by 2045, we can achieve US$50 billion, just from nickel," he said.
Indonesia’s nickel exports have indeed surged in value, supported by industrial policies mandating domestic processing and integrated investment in smelters, stainless steel, battery precursors, and electric vehicle supply chains. From just US$3.08 billion in 2010, the country’s nickel-based product exports climbed to US$33.64 billion in 2024. By March 2025, Indonesia had already recorded US$8.60 billion in nickel downstream exports.
At the global level, Indonesia has become the largest nickel producer, contributing 64% of global supply in 2024. The country added 1.5 million tonnes of new nickel capacity between 2020 and 2024, while output from the rest of the world declined by 500,000 tonnes over the same period.
Yet despite this success, the future of nickel demand particularly from the battery sector has become less certain. A June 2025 market outlook by Macquarie noted that although nickel consumption for electric vehicle batteries is still expected to grow at an annual rate of 11% through 2030, this growth has been substantially downgraded. The rise of alternative chemistries like LFP and LMFP, which require little or no nickel, has challenged previous assumptions.
On the supply side, domestic nickel ore availability is emerging as a key risk. Although Indonesia issued permits (RKABs) for 272 million tonnes of ore in 2024, actual production fell short at approximately 220 million tonnes. Similar bottlenecks are expected in 2025, as permit processing delays and environmental licensing issues continue to hamper mine output.
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Still, the downstream sector remains active. Indonesia saw a strong uptick in nickel pig iron production toward the end of 2024 and early 2025, contributing to high export volumes, albeit at lower average prices. Analysts warn that margins are thinning and supply chain efficiency is becoming more critical, especially in light of global oversupply and softer battery-linked demand.
Indonesia is also expanding its export destinations. While China remains the dominant buyer taking in around 80% of nickel exports in 2024, exports of MHP, nickel matte, and stainless steel have grown in markets such as India and Europe. Smelter projects linked to battery-grade products are expected to play a growing role in the country’s industrial base.
Luhut emphasized that nickel is just one of several strategic commodities Indonesia can leverage for downstream development. He noted seaweed as another underutilized resource with strong industrial potential, underscoring the government’s broader ambition to diversify and modernize the economy.
“This is just one product nickel, but we have other resources that can support our transformation into a value-added economy,” Luhut said.
With export growth, industrial integration, and global positioning all in motion, Luhut’s remarks reflect the country’s ongoing commitment to long-term value creation anchored in downstreaming and strategic resource management.
Editing by Reiner Simanjuntak
