Project Blue’s latest analysis explains why China and the USA are both shopping for nickel outside Indonesia — and why the pipeline of projects they are shopping for is so thin, and so heavily weighted to sulphide.
Nickel has spent three years as the market nobody wanted to talk about. Prices have been soft since 2023, Australian operations have closed or moved to care and maintenance, and the story looked settled: Indonesia won.
A BlueView published by Project Blue on 28 August 2026, written by Linghui Ni, argues the story is turning. Its case is that the same concentration that made Indonesian nickel unbeatable on cost has made it uncomfortable to depend on — and that Beijing and Washington are both now acting on that discomfort, for entirely different reasons.
One country, two-thirds of the world’s mined supply
Indonesia accounted for more than 65% of global mined nickel supply in 2025, with Chinese companies controlling much of its refining capacity, Project Blue reports. That build-out is what generated the persistent global surpluses and depressed prices that have closed or suspended higher-cost operations elsewhere — Australia most of all. It also concentrated an entire critical-minerals supply chain into a single jurisdiction.
China’s problem: policy risk in one jurisdiction
China is the world’s largest nickel consumer and processing centre, and nickel underpins its stainless steel, nickel-cobalt-manganese (NCM) battery and superalloy supply chains. But much of its overseas nickel investment and feedstock sits in Indonesia, and Project Blue identifies three developments that have made that concentration less comfortable.
1. Ore quotas got shorter, and smaller.
In October 2025 Indonesia cut the validity of RKAB production quotas from three years to one, requiring miners to reapply annually from their 2026 plans. Initial aggregate nickel ore quotas for 2026 were set at roughly 260–270 million wet metric tonnes — a 29–31% reduction on 379Mwmt in 2025. Miners were permitted to seek revisions from July 2026, but Project Blue notes any additional allocations are expected to be granted selectively, and a material increase has not been confirmed.
2. Fiscal settings remain unresolved.
Royalty rates, and proposed export and windfall taxes, have been under active consideration since March 2026, as higher oil prices and rising energy subsidies pushed the government to look for revenue. Jakarta has confirmed export and windfall taxes will not land in 2026 — but 2027 measures and further royalty changes remain open. Project Blue’s read is that this raises perceived regulatory risk and can cause investors to delay capital commitments.
3. Governance capacity showed strain.
In July 2026, additional inspections of processed mineral exports for rare earth elements and radioactive materials were introduced before content thresholds, testing procedures and designated laboratories were in place. Around 120 surveyor reports were delayed and shipments of alumina, nickel pig iron and mixed hydroxide precipitate were disrupted. Exports resumed in late July, but Project Blue flags a bigger test in 2027, when Indonesia plans a centralised export-oversight platform and a domestic commodity exchange.
America’s problem: eligibility, not access
The USA has no domestic nickel smelter and relies entirely on imported primary refined nickel. Its constraint is not Indonesian policy — it is what qualifies.
Under the One Big Beautiful Bill (OBBB) Act, the former Section 30D FEOC restriction no longer applies to vehicles acquired after September 2025, but a broader Prohibited Foreign Entity (PFE) framework now attaches to incentives including the Section 45X Advanced Manufacturing Production Credit. Indonesia is not a US-designated covered nation, but Project Blue observes that many Indonesian joint ventures could still face PFE-related restrictions through Chinese ownership and contractual control. The pool of commercially viable, PFE-clean nickel is small, and shrinking.
Allied supply has not proved a reliable substitute. Canada supplies half of US nickel imports and has sat in the middle of Washington’s tariff campaign — up to 50% on approximately US$20Bn of Canadian goods in August 2026, and a threatened 50% tariff on vehicles and auto parts from 2027. Project Blue’s point is that even US ownership of a Canadian refinery would not remove exposure to Canadian jurisdiction or trade tension.
Domestically, the clock is running. The Eagle nickel-copper mine in Michigan — the country’s only operating primary nickel mine — has a mine plan supporting operations only to H2 2030. Of the five US nickel projects Project Blue tracks, none has a credible base-case production date before 2030; Tamarack North, the most advanced, is estimated at 2032.
The USA’s constraint is not access to nickel. It is access to nickel that qualifies.
The contest is already live
The clearest illustration is Kabanga in Tanzania — an undeveloped high-grade nickel sulphide project with proven and probable ore reserves of 52.2Mt at 1.98% Ni. In June 2026 China’s Lygend Resources was reported in talks for an equity stake in Lifezone Metals’ project. By August, Lifezone had reportedly selected the US-backed Orion Critical Mineral Consortium as preferred equity partner instead, with reporting pointing to roughly US$500–600M for a sizeable minority and Lifezone retaining control.
It is not an isolated case. Lygend is also bidding for Glencore’s 49% of the idled Koniambo operation in New Caledonia; in 2025 Anglo American agreed to sell its Brazilian nickel business to China Minmetals-controlled MMG for US$500M, still subject to approval; and on the US side Gillon Capital and a Glencore-led consortium are competing for Sherritt International, with its Moa nickel-cobalt interest in Cuba and the Fort Saskatchewan refinery in Alberta.
The pipeline is thin — and it is sulphide
Project Blue’s tracked pipeline of nickel mine projects outside Indonesia expected online before 2035 runs to eleven assets and roughly 270kt of nickel a year of planned capacity, across Canada, Brazil, Australia, Tanzania, the Philippines and the USA. Against a mined market measured in millions of tonnes, that is not much optionality — which is why Project Blue expects competition for equity stakes, project financing, offtake and control to intensify.
Nearly nine-tenths of that capacity — 235kt of 270kt — sits in sulphide and awaruite ore rather than laterite. That split matters. Sulphide is the feed that answers the questions Western buyers now ask: lower processing energy, lower carbon intensity, and a clean line of sight on ownership all the way to the concentrate.
Where this leaves Australian sulphide
Australia sits on both sides of this ledger. It has been the largest casualty of the price cycle Indonesian supply created. It is also one of very few jurisdictions able to offer nickel sulphide from an allied, non-PFE-linked supply chain. Only one Australian asset appears in Project Blue’s pre-2035 pipeline: BHP’s West Musgrave, at 31kt Ni per year.
That scarcity is the argument for new discovery. Nimy Resources’ Mons Project covers approximately 3,167km² across 17 tenements in the Murchison Domain of Western Australia’s Yilgarn Craton, 370km northeast of Perth — a base and precious metals greenstone belt that had not previously been recognised.
At the Masson prospect, discovery hole NRRC0100 returned 5m at 0.73% Ni, 0.53% Cu, 0.06% Co and 0.55g/t 2PGE from 102m within a broader 10m sulphide zone, with copper above 1% in a vertical lens from 126–298m. The mineralised body extends 240m along strike, has been intersected from 102m to 328m downhole, and remains open down dip and along strike. Masson is the first of five interpreted intrusive settings mapped in the northern Mons Project.
Strategic context is not a discovery result, and no amount of geopolitics de-risks a drill hole. But Project Blue’s analysis explains something worth understanding: the buyers of nickel sulphide are changing, and the shortage of development-ready assets outside Indonesia is likely to become more visible, not less.