Nickel: Extraction
Two ore types, two very different routes to metal
What this tab covers How it is mined, drilled or grown, and processed into a tradeable form: the main methods compared, their unit economics, by-products, and the companies that do this work globally and in India.Nickel comes from two very different ore types. Laterites, formed by tropical weathering, hold 54% of identified resources, and magmatic sulfide deposits hold 35% (USGS). Sulfides, as at Norilsk in Arctic Russia, are concentrated and smelted, yielding copper, cobalt and platinum-group metals as well. Laterites in Indonesia, the Philippines and New Caledonia are smelted into ferronickel or nickel pig iron, or leached under pressure for battery chemicals. Nickel pig iron was a Chinese improvisation of the 2000s, reviving old blast-furnace methods on imported ore (Humphreys).
Nickel reaches market by two very different paths. Sulphide ores, the historic source, are concentrated by flotation, smelted to matte and refined to pure Class 1 metal, with copper, cobalt and platinum-group metals as by-products. Laterite ores, now the bulk of supply, cannot be floated. The saprolite layer, richer in nickel and magnesium, is smelted in rotary kiln electric furnaces (RKEF) into nickel pig iron or ferronickel for stainless steel. The limonite layer, lower grade but richer in cobalt, is dissolved in sulphuric acid at high pressure (HPAL) to make MHP for batteries. Indonesia's shift to these laterite routes since its 2014 and 2020 ore export bans has moved the cost curve down and the industry's centre to Sulawesi and Halmahera.
Methods compared
| Method | Share of supply | Typical scale | Recovery / efficiency | By-products | Unit cost |
|---|---|---|---|---|---|
| Laterite (saprolite) open pit + RKEF to nickel pig iron or ferronickel | about 48% of 2025 primary nickel production from Indonesian NPI alone (1.86 Mt Ni of 3.88 Mt); NPI was about 70% of nickel raw materials in 2024 | single parks run dozens of RKEF lines; Jindal's Halmahera JV has 200 kt/yr NPI capacity | nickel recovery 92-97% | none of value; large volumes of slag | indicative (basis: SMM estimate, June 2025): cash cost about $9,000-12,000/t Ni for RKEF ferronickel; Chinese NPI with imported ore sits higher on the curve |
| Laterite (limonite) + high-pressure acid leach (HPAL) to MHP | about 11-12% of 2025 primary nickel production (Indonesian MHP 445-471 kt Ni of 3.88 Mt) | Indonesian MHP output totalled 445.5 kt Ni in 2025 across a handful of plants; one new project (SLNC) is budgeted at about $1.8 billion | nickel and cobalt recovery above 90%; ore grade 0.8-1.5% Ni | cobalt (in MHP), scandium potential; large tailings | indicative (basis: Benchmark and SMM estimates, 2025): C1 cash cost about $9,800/t Ni Indonesian average; $8,000-10,000/t range; sulphur was about 29% of MHP cost when above $530/t |
| Sulphide mining + flotation + smelting to matte + refining | sulphides were 32% of nickel ore supply in 2018, heading to about 12% by 2030 (SMM) | Nornickel 198.5 kt Ni (2025); Vale Base Metals 177.2 kt (2025); Glencore 71.9 kt (2025) | n/a | copper, cobalt, platinum-group metals (Nornickel 2.725 Moz palladium in 2025), sulphuric acid | no verified company cost figure; Nornickel is low cost because of large PGM and copper credits |
| Secondary nickel (stainless and alloy scrap) | about 60% of US apparent consumption in 2025; EU end-of-life recycling input rate 16% | n/a | n/a | chromium, molybdenum and iron recovered in the same melt | n/a |
How each method works
Laterite (saprolite) open pit + RKEF to nickel pig iron or ferronickelOre is dried and pre-reduced in rotary kilns, then melted in electric furnaces to an iron-nickel alloy. NPI carries about 10-15% Ni and goes straight to stainless melt shops. Some NPI is converted to high-grade nickel matte for refining. Plants sit in Indonesian industrial parks with captive coal power.
Low capital cost and fast build; coal-heavy, high carbon intensity, and output only fits stainless steel unless converted to matte.
Mysteel Dec 2025; INSG/SMM Oct 2025; SMM June 2025; Fastmarkets 2025; Humphreys (2015) Laterite (limonite) + high-pressure acid leach (HPAL) to MHPLow-grade limonite is leached with sulphuric acid in titanium-lined autoclaves at about 250 C. Nickel and cobalt are precipitated as mixed hydroxide (MHP), which is refined to battery-grade sulphate in China or Indonesia. Sulphur for acid is a major input.
First-quartile cost and battery-grade product; technically hard, capital-heavy, and sensitive to sulphur prices and tailings risk.
Benchmark Mineral Intelligence June 2025; SMM June 2025 and Jan 2026; Mysteel Dec 2025 Sulphide mining + flotation + smelting to matte + refiningUnderground or open-pit sulphide ore is crushed and floated to a nickel-copper concentrate, smelted to matte and refined electrolytically or by carbonyl process to cathode, pellets or powder. Norilsk, Sudbury, Voisey's Bay and Jinchuan are the main centres.
Produces LME-grade Class 1 metal and valuable co-products; deposits are scarce, deep and costly, and Western mines closed at 2024-25 prices.
Vale 4Q25 production report (SEC 6-K, 2026); Nornickel via Reuters Jan 2026; Glencore FY2025 production report; SMM Oct 2025 Secondary nickel (stainless and alloy scrap)Scrap is sorted by grade and remelted with fresh nickel units in stainless and alloy melt shops, so its nickel never needs re-extracting. Battery recycling to recover nickel sulphate is small but growing.
Cheap and low carbon; limited by the long life of stainless products and scrap sorting quality.
USGS MCS 2026, Nickel; EU CRM study 2023 Unit economics are indicative ranges from the sources named; costs vary widely by deposit, region and year.Share produced as a by-product
About 5% of primary supply comes as a by-product (Nassar, Graedel & Harper 2015, approximate).Who does it: global
| Company | Country | Activity | Volume | Year | Source |
|---|---|---|---|---|---|
| Tsingshan Holding Group | China (operations in Indonesia) | NPI, stainless steel, matte | not published | n/a | Private company; output not published. Widely described as the world's top nickel producer (Bloomberg via Mining.com, 2023). |
| Nornickel | Russia | sulphide mining, smelting, refining (Class 1) | 199 kt Ni | 2025 | Nornickel 2025 results via Reuters/Kitco, 28 Jan 2026 |
| Vale Base Metals | Brazil/Canada/Indonesia | sulphide and laterite mining, refining | 177 kt Ni | 2025 | Vale 4Q25 production report (SEC Form 6-K/A) |
| Glencore | Switzerland (Canada, Norway, New Caledonia) | sulphide mining, Nikkelverk refinery | 71.9 kt Ni (own sourced) | 2025 | Glencore Full Year 2025 Production Report |
| Jinchuan Group | China | sulphide mining, smelting, refining | not published | n/a | Not found in sources consulted |
| Zhejiang Huayou Cobalt | China (HPAL in Indonesia) | HPAL MHP, battery precursors | not published | n/a | Not found in sources consulted |
Who does it: India
| Company | Country | Activity | Volume | Year | Source |
|---|---|---|---|---|---|
| Jindal Stainless | India | stainless steel (largest Indian nickel consumer) | 2.56 Mt stainless steel sold | FY2026 | BigMint, JSL FY26 performance, 2026 |
| New Yaking (49% Jindal Stainless) | Indonesia | nickel pig iron smelter, Halmahera | 200 kt NPI a year capacity (about 14% Ni) | 2024 | Reuters via Kitco, March 2023; Fastmarkets 2025 |
| Nicomet (Vedanta) | India | nickel and cobalt refining from imported feed, Goa | 7.5 kt Ni+Co a year capacity | 2021 | Vedanta press release, 20 Dec 2021 |
| Hindustan Copper | India | nickel sulphate recovery from copper refinery electrolyte, Ghatsila | 0.39 kt nickel sulphate a year installed capacity (no output reported since 2004-05) | 2022 | IBM Indian Minerals Yearbook 2022, Nickel |
India mines no nickel and imports all of it: 36,687 t of unwrought nickel in FY2026 (NSE review), plus fast-rising NPI and ferronickel from Indonesia (178,527 t in Jan-Oct 2024, Fastmarkets). It has 189 Mt of nickel ore resources, 93% in Odisha's Sukinda belt, but recovery from chromite overburden is not yet commercial (IBM 2022). NMDC has sought a nickel block in Jajpur.