Indonesia is curbing nickel ore supplies to protect smaller local miners as the global battery metal faces a prolonged downturn, according to Eramet SA, a French mining firm operating in the country. This year, Eramet received a sales quota 29% lower than anticipated, which contributed to a drop in its share price in October.

The government’s restrictions aim to stabilize ore prices and safeguard local miners, but they have shifted production toward higher-grade nickel used in stainless steel. This has reduced the availability of battery-grade nickel ore, forcing local smelters, vital to Indonesia’s electric vehicle ambitions, to rely on costly imports.

Eramet Indonesia CEO Jerome Baudelet emphasized the significance of maintaining competitive nickel supplies. With Indonesia now producing over half of the world’s nickel, its dominance in the market is growing. The country’s new administration is expected to continue policies prioritizing the domestic processing of minerals.