NORTHERN KONAUE, SOUTHEAST SULAWESI, INDONESIA – AUGUST 3: This aerial photo – view of a nickel mining site in North Konawe, South East Sulawesi, Indonesia, on August 3, 2023. Global demand for nickel raw material, a key component of batteries, especially those used in electric vehicles (EVs), is rapidly increasing. According to estimates by the United States Geological Survey (USGS), global nickel production increased by 21% in 2022 alone. Indonesia has the world’s largest nickel reserves and is leveraging its reserves to attract investment in the battery supply chain, according to a report by the Center for Strategic and International Studies. Demand for nickel in the batteries needed for electric cars is expected to outstrip demand from other industries such as steel production by 2030. Indonesia alone will account for about half of the growth in global nickel supply by 2025. The success of the country’s refining projects is a key factor in determining both the supply and price of nickel in the global market. According to the same CSIS report, as of 2020, Indonesia had 292 nickel mining permits, mainly on the island of Sulawesi, which holds the bulk of the country’s nickel reserves. Central Sulawesi province is home to the Indonesia Morowali Industrial Park (IMIP), an integrated nickel hub for steel production and a planned supply chain for battery production. (Photo credit: Ulet Ifansasti/Getty Images)
Oulet Ifansasti | Getty Images News | Getty Images
The United States and Indonesia will discuss on Monday how to proceed with a potential minerals partnership aimed at boosting trade in nickel, the electric vehicle (EV) battery metal, according to three people with direct knowledge of the conversations.
When Indonesian President Joko Widodo visits the White House for talks with US President Joe Biden on Monday, he will discuss next steps that could move the two countries towards formal negotiations on the partnership, one of the people said. The steps will be discussed.
The Biden administration remains concerned about Indonesia’s environmental, social and governance standards and is considering how the deal would work, the people said. The administration also plans further talks with U.S. lawmakers and labor groups in the coming weeks, one of the people said.
“There is a lot of work to do before formalizing negotiations on a significant mineral partnership,” the person said.
The White House did not respond to requests for comment.
Indonesia, which has the world’s largest nickel ore reserves, asked the US in September to start talks on a trade deal for the critical mineral so that exports from the Southeast Asian country would be subject to the US Inflation Control Act (IRA). did.
Most of Indonesia’s nickel is processed into crude metal, but the government is keen to develop an EV supply chain to tap into the country’s vast nickel reserves, which can be processed into battery materials.
Environmental impact
Biden administration talks, including U.S. Trade Representative Katherine Tai and the White House, are aimed at ensuring potential nickel supplies are produced with as little environmental impact as possible, according to one of the people directly advising the Biden administration. The emphasis is on making sure that And he was not authorized to speak publicly.
“While the overall momentum is encouraging, (we) don’t want to discount the fact that there is still a significant amount of work to be done here,” one of the people said.
Indonesia has the world’s largest supply of nickel, and Indonesia’s nickel mines have been cited as causing serious deforestation and water pollution.

Under U.S. law guidelines issued in March, Washington state requires that EV batteries must have certain amounts of critical minerals in North America or free trade in order for EVs sold in the U.S. to qualify for the tax credit. It requires that it be produced or assembled in the other country. Indonesia does not have a free trade agreement with the United States.
The Biden administration is also discussing ways to carve out nickel mined from Indonesia and processed in China from receiving IRA credits, one of the people added.
One estimate puts the global market value of the nickel industry at $33.5 billion in 2022, but the market is oversupplied.
America’s only nickel mine is scheduled to close within the next few years, and there are no domestic nickel smelters, a risk to Mr. Biden’s goal for the U.S. to lead in EV manufacturing.
The government gave Talon Metals nearly $115 million last year to partially fund a nickel processing plant in North Dakota. tesla.
Talon is seeking permission from Minnesota for a proposed nickel mine, but is facing opposition from Native American tribes. Many U.S. miners say the Biden administration should focus on approving domestic projects rather than seeking international supplies.