Period: Early May 2026
Scope: Nickel Alloys, Stainless Steel, and Related Raw Materials
Sources: Indonesian ESDM, LME, Mysteel, SMM, INSG, and public market data
The global nickel and stainless steel market remained highly volatile in early May 2026. Tightening upstream supply in Indonesia, fluctuating nickel prices, and weak recovery in traditional downstream sectors continue to reshape the global stainless steel supply chain.
At the same time, demand from new energy industries, including electric vehicles, photovoltaic equipment, and high-end manufacturing, continues to support long-term consumption growth for nickel alloys and stainless steel materials.
This report provides an overview of:
China’s stainless steel crude steel production is expected to rise slightly in May 2026.
According to market data, crude stainless steel output from 43 major Chinese mills reached approximately 3.732 million tons in April, representing:
Among different product categories:
May production is projected to reach approximately 3.756 million tons, up:
The 300-series segment is expected to reach approximately 2.048 million tons, increasing:
Improved profitability has encouraged mills to maintain higher operating rates, contributing to additional market supply and rising inventory levels.
The global nickel ore supply chain continues to face pressure.
Indonesia
In Indonesia, tighter RKAB quotas combined with sulfur shortages have further intensified supply tightness within the nickel mining and smelting sector.
Philippines
Meanwhile, nickel ore shipments from the Philippines increased after the rainy season ended, creating short-term pressure on ore prices.
China Port Inventory
China’s nickel ore port inventory has accumulated to approximately7.37 million wet metric tons. At the same time, import cost inversion continues to weaken domestic purchasing momentum.
Overall, the short-term market structure remains characterized by:
Strong Supply + Weak Demand
Several major developments affected the nickel alloy and stainless steel market during May:
New Energy Sector
Demand from the new energy sector continues to show resilience.
Industries including:
continue supporting demand for:
Traditional sectors such as construction remain under pressure due to weakness in the real estate market.
As a result:
The core contradiction in the current market remains:
Tight upstream nickel supply vs. weak downstream demand recovery
For procurement teams and industrial buyers, this means:
The market has therefore entered a phase of:
High Costs + Weak Demand
with prices likely to fluctuate within a relatively high trading range.
The Indonesia Ministry of Energy and Mineral Resources (ESDM) had initially planned to increase mining royalty rates for nickel, copper, tin, and other mineral resources.
However, after reassessing global market conditions and domestic industrial pressure, the implementation has been temporarily postponed while authorities reconsider a more balanced policy framework.
On May 8, the Indonesia Nickel Miners Association (APNI) and the Philippine Nickel Industry Association (PNIA) signed a memorandum of understanding to strengthen regional nickel cooperation.
Key highlights include:
This agreement aims to support Indonesia’s growing nickel smelting capacity.
As of May 14:
Most market institutions currently expect nickel prices to remain range-bound in the near term.
Mainstream stainless steel prices have increased significantly compared with the beginning of 2026.
Examples include:
The primary driver remains rising upstream raw material costs, although downstream acceptance remains relatively weak.
Raw Material Costs
Inventory Pressure
High inventory levels continue limiting upside price momentum.
Market Sentiment
Frequent Indonesian policy adjustments and global macroeconomic uncertainty have weakened market confidence and reduced trading activity.
Policy Impact
The following continue influencing market prices:
The current market environment can be summarized as:
Costs supporting prices, while demand limits further upside.
For industrial buyers and nickel alloy procurement teams:
A more practical strategy may include:
rather than relying on one-directional market expectations.
The global new energy sector continues accelerating demand for nickel-containing materials.
Global EV sales in 2026 are projected to reach approximately 19 million units, increasing 15.2% year-on-year.
This trend is expected to significantly increase demand for:
China’s apparent stainless steel consumption is projected to reach approximately 34.45 million tons in 2026, up 2.95% year-on-year.
Demand growth from the new energy sector is expected to exceed 12%.
Nickel-based superalloys now account for approximately 80% of high-temperature alloy demand and continue dominating high-end manufacturing sectors including:
Meanwhile, high-molybdenum nickel-containing stainless steel grades such as 316L continue expanding in:
Current market signals suggest that stainless steel and nickel prices are likely to remain within a high-level trading range over the next quarter.
Key reasons include:
Indonesia remains the largest uncertainty factor for the global nickel market.
Why are nickel prices staying high in 2026?
Nickel prices remain elevated mainly due to tightening Indonesian supply policies, rising mining costs, sulfur shortages, and continued demand from the new energy sector.
How do Indonesian policies affect stainless steel prices?
Indonesia is one of the world’s largest nickel suppliers. Changes in mining quotas, royalties, and export-related policies directly impact nickel ore costs, which then influence stainless steel production costs globally.
Will stainless steel prices continue rising?
Prices are currently supported by high raw material costs, but weak downstream demand and rising inventories may limit further upside in the short term.
Which industries are driving nickel demand growth?
The main growth sectors include electric vehicles, battery manufacturing, renewable energy, aerospace, and high-end industrial equipment.
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