Tracking nickel's supply side, particularly the Indonesian output for EV batteries. The pace of new capacity coming online is significant. Are we headed for a sustained surplus, or will demand from the EV transition absorb it faster than current projections?
That's the million-dollar question, isn't it? Indonesia's ramp-up is undeniable, but the sheer scale of EV battery demand over the next decade could still outstrip even aggressive supply. I think it'll be a closer race than some expect.
What about other nickel uses? Stainless steel still takes a huge chunk. If industrial demand picks up globally, that could absorb some of the 'surplus' intended for batteries, effectively tightening the market even with Indonesian expansion.
Don't forget the quality aspect. Not all nickel is created equal for EV batteries. While Indonesia is boosting output, the specific grades and processing required might still create bottlenecks, preventing a complete oversupply for high-end applications.
I'm leaning towards a sustained surplus, at least for a few years. The capital expenditure going into nickel production in Indonesia is massive, and it often takes time for demand to catch up to such rapid supply expansion. We might see some price pressure.
I'd argue the projections already account for pretty aggressive demand. If the EV transition accelerates even faster than anticipated due to policy changes or technological breakthroughs, then yes, demand could easily eat up that new capacity. It's a highly dynamic situation.