Bernstein has revised its outlook for the nickel market, increasing its average 2026 price forecast to $17,357 per metric ton from an estimated $15,164 per ton this year. The investment firm believes the global market is moving closer to balance, with only a limited supply surplus remaining after expectations at the beginning of the year pointed to a much larger oversupply of more than 200,000 metric tons.
Indonesia Drives Market Changes
The brokerage said Indonesia continues to have the greatest influence on global nickel prices through tighter ore availability, higher benchmark HPM pricing and growing uncertainty surrounding mining policy.
Production costs have risen sharply, with Bernstein estimating C1 cash costs of $17,870 per ton at the 75th percentile and $18,650 per ton at the 90th percentile, both well above 2025 levels.
Reports that Indonesia may increase RKAB mining quotas to between 300 million and 350 million wet metric tons during its July review are believed to have contributed to June’s decline in nickel prices.
Supply Chain Disruptions Add Cost Pressure
Geopolitical tensions involving Iran, the United States and Israel have also disrupted sulphuric acid supplies used in HPAL nickel production. Rising granular sulphur prices—from under $600 per ton to around $1,000—have forced some Indonesian producers to reduce output.
Bernstein expects these cost pressures to ease once supply conditions improve, particularly if geopolitical tensions subside and sulphuric acid availability recovers.
Demand Outlook Remains Stable
Electric vehicle demand has remained mixed, with global sales increasing just 0.5% through April. Battery electric vehicles continued to grow, while plug-in hybrid sales weakened. LFP batteries remain dominant, although Bernstein believes sodium-ion batteries could become a more meaningful source of nickel demand as production costs fall over the next few years.
Meanwhile, stainless steel continues to underpin the market. Combined nickel inventories on the LME and SHFE stand at approximately 375,000 metric tons, but Bernstein expects stainless steel demand to increase by around 5% year-on-year, helping support overall consumption.
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