PT Vale Indonesia and China’s Taiyuan Iron & Steel (TISCO) are setting up a 49:51 JV in Bahodopi, in the Morowali district in Indonesia, to produce 73-80ktpy of ferronickel. The ferronickel plant is planned to be commissioned in 2025 at an estimated cost of US$21Bn.

Indonesia has managed to attract large investments in the refining of its nickel reserves through strategic export bans of unprocessed ores. The country has become the largest source of nickel from its laterite deposits and many Chinese ferronickel plants once reliant on Indonesian concentrate feed have suspended output and converted plants to other ferroalloys.

The original interest in Indonesia’s nickel resources was spurred on by the stainless steel industry and the Vale-TISCO JV is considering adding a stainless steel plant to the future plans of this investment. Tsingshan, another Chinese investor in Indonesian nickel processing, led the way by going beyond ferronickel and officially commissioned Indonesia’s first stainless steel mill in 2017. However, more recently the nickel supply chain in Indonesia has focussed on joining the battery electric vehicle raw material and a swath of projects have been added in the country.

Of all the lithium-ion battery cathode raw materials, nickel is the one where growth in battery demand may compete with more traditional steel demand areas.   With nickel demand exposed to growth trends from both stainless steel and Li-ion batteries, several nickel suppliers are looking to adopt processing flowsheets to be able to capture value from both markets.