Indonesian nickel company PT Ceria Nugraha Indotama plans to expand its ferronickel production capacity, a company official said, even though the nickel market faces oversupply in the coming years.
Ceria in late April started production in its rectangular rotary kiln electric furnace, which has capacity to produce 63,200 metric tons of ferronickel annually.
The additional production would increase capacity by a similar amount and requires investment of about $200 million.
“We are in the process of strategic funding with financial institutions. If all goes well, we are planning to start construction this year,” corporate secretary Imelda Agustina Kiagoes told Reuters on the sidelines of an industry conference held by Shanghai Metals Markets.
Industry analysts and nickel company executives told an industry event this week that oversupply in the global nickel market is expected to persist for the next few years given the expansion of production capacity and slower growth in demand for the metal used in batteries and stainless steel.
However Kiagoes said there was still demand in Europe and the United States for the company’s product, which has a nickel content of 22%.
(By Bernadette Christina; Editing by Barbara Lewis)
