The development marks the first major step by an Indian stainless steel producer to secure an overseas supply of raw materials. 

India’s largest stainless steel producer, Jindal Stainless (Jindal), has commissioned its nickel pig iron (NPI) smelter in Halmahera, Indonesia. The facility, established as a JV with New Yaking Pte, was initiated in March 2023, with Jindal acquiring a 49% stake for approximately US$157M. The plant has the capacity to produce 200ktpy NPI, containing 14% Ni (28ktpy Ni).

Jindal produces 2.9Mtpy stainless steel and the company’s nickel requirements reportedly total 125ktpy Ni. India is nickel-resource poor, meaning its stainless steel industry is heavily reliant on imports of ferronickel and nickel-containing scrap. Given the current geopolitical climate and volatile nickel price, by securing a reliable source of nickel units, Jindal has locked in long-term security for its stainless steel operations.

Indian stainless steel producers have traditionally received primary nickel units in the form of ferronickel, supplied by Indonesia’s PT Antam. However, through Chinese innovation, NPI has quickly grown to become the key, low-cost stainless steel feedstock and now represents by far the most abundant form of nickel to the market. Project Blue estimates that Indonesian NPI output totalled 1.34Mt Ni last year (excluding material converted to nickel matte), which was mostly exported to Chinese stainless steel producers and consumed by integrated stainless steel operations in Indonesia.  

Jindal’s development also serves to illustrate the incredible speed at which NPI capacity has, and continues, to be brought online in Indonesia. In this case, it took a mere 18 months from a deal being signed to the plant being commissioned. However, it may not be possible for companies to replicate these successes over the medium term, given that the Indonesian government is rumoured to be considering limiting future development of NPI capacity in the next few years to preserve its nickel resources for higher-value battery-grade products.