Bernstein Lifts 2026 Nickel Price Forecast on Tighter Indonesian Supply

Bernstein has significantly increased its price forecast for nickel, now projecting an average of $17,357 per metric ton in 2026, a notable rise from its 2025 estimate of $15,164 per ton. The revision reflects a dramatically altered market view, which now anticipates only a small surplus, a sharp contrast to consensus estimates of over 200,000 metric tons at the beginning of the year, according to the firm's analysis.

Indonesian Constraints Drive Costs Higher

The primary driver behind the revised outlook is Indonesia, which is tightening ore availability and introducing greater commercial uncertainty. This has pushed up the cost base for nickel production, with Bernstein citing geopolitical conflict as a key factor in creating a shortage of sulphuric acid, a crucial input for the country's High-Pressure Acid Leach (HPAL) operations.

According to the firm, this has led to a substantial increase in production costs:

• 75th percentile C1 cash costs have risen to $17,870 per ton, up from $14,650 in 2025.
• 90th percentile C1 cash costs have increased to $18,650 per ton, compared to $15,300 in 2025.

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Bernstein also noted that reports of Indonesia potentially raising its mining quotas (RKAB) in July likely contributed to a pullback in nickel prices in June.

Mixed Demand Picture and High Inventories

On the demand side, the picture is more complex. Global electric vehicle sales through April showed tepid year-over-year growth of just 0.5%, with battery electric vehicle sales rising 5.1% while plug-in hybrids declined 8.5%. Furthermore, LFP (lithium iron phosphate) chemistry, which does not use nickel, remains dominant in both EV and energy storage batteries.

However, underlying demand from the stainless steel sector, which accounts for the majority of first-use nickel, remains supportive with expected growth of around 5% year-over-year. This is set against a backdrop of high inventories, with combined London Metal Exchange (LME) and Shanghai Futures Exchange (SHFE) stocks at approximately 375,000 metric tons, equivalent to about 9% of projected 2025 mine production.