Australia’s Nickel Industry Faces Severe Threats: A Call for Immediate Government Action
Australia's nickel industry is under significant threat, with potential job losses of up to 10,000 and investments worth $1.8 billion at risk if the sector collapses, according to a new report commissioned by the Chamber of Minerals and Energy WA and authored by Madala. Released today, the report highlights the dire situation facing the nickel sector, primarily due to competition from inexpensive Indonesian products backed by Chinese investments.
The industry is grappling with a 28 percent cost disadvantage relative to Indonesia, leading to the shutdown of five nickel mines since September 2023, which in turn has eliminated 33 percent of Australia's domestic production. An additional 31 percent of production is currently at risk. Rebecca Tomkinson, CME WA's chief executive, emphasized the urgency of the situation, calling on both state and federal governments to implement immediate measures to safeguard the industry's future.
Tomkinson pointed out the crucial role of the nickel industry in Australia's ambitions to be a leader in the battery sector, warning that the industry's collapse would jeopardize downstream processing and Australia's position in the global supply chain. The report criticizes the exclusion of nickel, along with lithium and copper, from the federal critical minerals strategy and underscores the necessity for rapid governmental intervention.
Proposed measures include temporary and targeted royalty relief, initiatives to support low-emissions energy supply, the development of strategic industrial areas, and the simplification of approval processes. Despite the current challenges, the report also identifies opportunities for Australian nickel, such as a projected 9 percent annual demand growth and the potential to produce lower emissions compared to key competitors like Indonesia, China, and Brazil.
