Indonesia's Nickel Quota Relaxation May Lure Back Foreign Funds to Mining Stocks

Indonesia's Ministry of Energy and Mineral Resources is considering relaxing nickel production quotas for 2026, a policy shift anticipated to lure foreign capital back into the nation's mining stocks. This move is also expected to act as a positive catalyst for the mining sector, particularly for companies involved in the government's downstreaming agenda.

Elandry Pratama, an analyst at Panin Sekuritas, views the potential relaxation and policy support for the nickel industry as a means to expedite the realization of national downstreaming programs. He suggests the policy could enhance asset utilization for nickel mining firms such as PT Aneka Tambang Tbk (ANTM) and PT Vale Indonesia Tbk (INCO), both part of the MIND ID Group. "For ANTM, opportunities arise from strengthening the nickel business and developing the electric vehicle battery ecosystem, while VALE has catalysts from the expansion of processing facilities and ongoing downstreaming projects," Elandry stated.

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For ANTM, opportunities arise from strengthening the nickel business and developing the electric vehicle battery ecosystem, while VALE has catalysts from the expansion of processing facilities and ongoing downstreaming projects.

Pratama further noted that Indonesia's strategic position in the global electric vehicle battery supply chain could improve the perception of its nickel sector among international investors. Coupled with improvements in fundamental performance, this could open doors for capital inflow into related sectors. For context, ANTM's nickel ore production reached 16.11 million wet metric tons (wmt) in 2025, a 62% increase from 2024. INCO's total nickel production in matte form was 72,027 metric tons (mt) in the same year.

Lukman Leong, a commodity analyst at Doo Financial Futures, agrees that the policy could increase investor interest in Indonesia's mining sector by improving corporate growth prospects. However, he cautioned that foreign capital flows are influenced by broader macroeconomic conditions, including global interest rates, the rupiah's exchange rate, and overall sentiment towards emerging markets. "Therefore, this policy is more likely to encourage sector rotation into nickel stocks rather than being the primary trigger for foreign capital inflows into the Indonesian market as a whole," Leong explained. This comes at a time when the Indonesian stock market has experienced significant foreign outflows, with a net foreign sell of Rp76.15 trillion year-to-date. Despite this trend, ANTM and INCO have seen net foreign buys of Rp508.19 billion and Rp50.84 billion respectively on a monthly basis.

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Therefore, this policy is more likely to encourage sector rotation into nickel stocks rather than being the primary trigger for foreign capital inflows into the Indonesian market as a whole.