The General Chairman of the Indonesian Nickel Industry Forum (FINI) has proposed that Indonesia's nickel downstream industry urgently needs to deepen its industrial chain layout, with a focus on developing high-purity electrolytic cobalt products, in order to break through the current industry stagnation bottleneck and significantly increase the added value of minerals. For a long time, Indonesia's nickel processing industry has mostly remained at the stage of primary intermediate products such as nickel pig iron and nickel hydroxide, with a large amount of associated cobalt elements discarded as tailings waste, resulting in extremely low resource utilization and failure to fully release industrial value. According to FINI, relying on high-pressure acid leaching (HPAL) hydrometallurgy and electrorefining technology, Indonesia can purify and produce electrolytic cobalt with a purity exceeding 99.8% from nickel ore, multiplying the product value. As a core raw material for new energy, electrolytic cobalt is a key raw material for NMC and NCA cathode materials in lithium batteries, ensuring the energy density and thermal stability of power batteries.
It is also widely used in fields such as high-temperature alloys for aero engines, high-end permanent magnet materials, and chemical catalysts, with huge market demand.
In addition, the electrolytic cobalt industry can form complementary synergy with Indonesia's downstream aluminum industry from bauxite. The incorporation of trace cobalt elements into silicon-aluminum alloys can greatly improve the mechanical strength and thermal stability of materials, making them suitable for aviation, high-end automotive, and new energy equipment manufacturing; aluminum-cobalt alloys also possess strong corrosion resistance and can be used for marine vessel infrastructure, helping Indonesia improve its local high-end alloy industry chain and reduce dependence on imported alloy raw materials. At present, Indonesia's mineral investment structure has undergone significant changes. In the second quarter of 2026, investment in bauxite surged to Rp 40.1 trillion, a quarter-on-quarter increase of 193%.
This far exceeds the Rp 29.4 trillion investment in nickel, with a large amount of capital shifting from the nickel industry to the bauxite track. Affected by long-term ore supply uncertainty and rising production costs, existing RKEF process nickel enterprises have suspended expansion plans. Industry insiders predict that in the next two to three years, Indonesia's nickel industry will undergo strategic adjustment, with the industry's development focus shifting from scale expansion to cost optimization, supply chain integration, and financial structure optimization. Industrial investment will fully tilt toward high-value-added deep-processing tracks such as electrolytic cobalt, helping Indonesia transform from a primary mineral processing country into a major producer of high-end new energy raw materials.
