Heavy machinery in a mining site in Indonesia. (PT Vale Indonesia)
On December 30, Indonesia announced that it will reduce mining output quotas to help stabilise and raise prices of key commodities such as coal and nickel. It aims to keep prices “rational,” allowing both businesses and the government to earn higher revenues through profits, royalties, and taxes. The policy will be implemented through tighter annual production approvals (RKAB). While details on the scale of the cuts are still unclear, the announcement has already pushed nickel prices up, reflecting market expectations.
Business implications
The new policy is generally positive for producers (higher prices, better margins) and the government, but negative for buyers and downstream industries that rely on cheap raw materials. For global markets, it could mean tighter supply and upward pressure on prices, especially for nickel.
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