Background: Indonesia Plans New Mineral and Strategic Commodities Exchange Indonesia is preparing to establish a new exchange for minerals and strategic commodities, targeted to begin operations on January 1, 2027 . The initiative aims to strengthen Indonesia’s role in commodity price formation, improve transaction transparency and establish domestic reference prices. In his August 14 speech to the DPR RI , President Prabowo Subianto said Indonesia should have greater control over the prices of its natural resources, specifically citing nickel, tin, gold, coal, gas, oil and coffee . He emphasized Indonesia’s ambition to move beyond being a commodity producer and exporter toward becoming a price setter. The exchange is expected to operate under OJK supervision , with detailed regulations targeted for September 17, 2026 . Nickel, tin and gold have been identified as potential commodities, although the final product coverage and trading framework have yet to be confirmed. Why It Matters for Nickel The planned exchange forms part of Indonesia’s broader effort to strengthen control over strategic commodities through downstreaming, export governance and production management. It could potentially provide: A centralized platform for price discovery; Greater transaction transparency; Standardized domestic reference prices; Better government access to transaction data; and Greater influence over regional commodity pricing. For nickel, the key issue is whether the exchange can eventually establish a credible Indonesian benchmark for physical transactions , potentially complementing rather than immediately replacing international benchmarks such as the LME. Nickel Product Scope Remains Unclear Although nickel has been identified as a potential strategic commodity, the government has not confirmed which nickel products will be traded. Potential products include: Nickel metal; Ferronickel; NPI; Nickel intermediates; and Nickel ore. For the Indonesian ore market, the most important question is whether saprolite and limonite will eventually receive standardized exchange-based pricing. There is currently no confirmed requirement for nickel ore transactions to be conducted through the exchange. Contract specifications, delivery locations, quality parameters and settlement mechanisms also remain undisclosed. Key Issues to Monitor Nickel coverage: Whether nickel is formally included and which products qualify. Ore inclusion: Whether saprolite and limonite will receive exchange-based pricing. Trading mechanism: Whether the exchange uses spot, futures or other standardized contracts. Benchmark methodology: Whether prices are derived from sufficient physical transactions to be representative. Liquidity and participation: Whether miners, smelters, traders and buyers actively use the platform. Relationship with LME: Whether the Indonesian benchmark develops as a complementary regional physical reference. Government influence: Whether the exchange primarily serves independent price discovery or broader commodity-management objectives. Launch readiness: Whether regulations, infrastructure and liquidity can be established before January 1, 2027 . Potential Impact on Nickel Ore Pricing If nickel ore is eventually included, the exchange could gradually shift Indonesian ore pricing from predominantly negotiated transactions toward a benchmark-based pricing system. Such a benchmark could incorporate factors already influencing Indonesian ore prices, including nickel grade, HMA, smelter demand, ore availability, mining costs, freight and RKAB availability. For saprolite , standardized pricing could improve transparency for RKEF/NPI feedstock. For limonite , an exchange reference could become increasingly relevant as HPAL capacity expands. However, the exchange’s influence will ultimately depend on liquidity, price transparency and broad adoption. In the near term, negotiated prices and existing benchmarks are therefore likely to remain dominant. SMM View SMM views the planned exchange as a structural development rather than an immediate change to nickel supply-demand fundamentals. Its short-term impact on Indonesian nickel ore prices should remain limited, as the trading rules, product specifications and participation requirements have yet to be confirmed. In the longer term, successful inclusion of nickel ore or nickel products could strengthen Indonesia’s influence over regional price discovery: Domestic Exchange → Indonesian Benchmark → Regional Physical Reference → Greater Pricing Influence The key developments to monitor are the September 17 regulations, final nickel coverage, physical ore inclusion, contract specifications, participation requirements, benchmark methodology and liquidity ahead of the planned January 1, 2027 launch.

Daily Price Update — August 18, 2026 Indonesian nickel ore CIF average prices strengthened across all three grades: 1.4% Ni: CIF average price rose from $52.6/wmt to $53.3/wmt, up $0.7/wmt. 1.5% Ni: CIF average price rose from $60.0/wmt to $60.8/wmt, up $0.8/wmt. 1.6% Ni: CIF average price rose from $64.9/wmt to $65.8/wmt, up $0.9/wmt, the largest increase among the three grades. Premium: Market players verified that the premium remained stable compared with the first half of August, with no significant change in the prevailing premium level. Overall: CIF average prices increased by $0.7–0.9/wmt, indicating a moderate firming in Indonesian nickel ore prices, while premium levels remained steady. Indonesia Policy Update Indonesia’s planned Mineral and Strategic Commodities Exchange remains the key recent policy development relevant to the nickel market. The exchange is expected to cover nickel, coal and palm oil, with operations targeted for January 1, 2027, aiming to establish domestic reference prices for strategic commodities. Nickel impact: The exchange could strengthen Indonesia’s influence over nickel price formation and domestic benchmarks, potentially increasing the role of Indonesian reference prices in international nickel trade. Latest development: State Secretary Minister Prasetyo Hadi said on August 17 that preparations for the exchange are underway. The platform is tentatively referred to as Icomex.

[8.19 Morning Meeting Minutes] The National Bureau of Statistics: In July, the value-added of industrial enterprises above designated size grew 4.5% YoY in real terms; sales prices of new commercial residential buildings in first-tier cities turned flat MoM after a 0.1% increase in the previous month. The most-traded SHFE nickel 2609 contract moved sideways in the morning session, ending at 128,410 yuan/mt, up 0.19%. Driven by factors including the mild cooling of the US July PPI and further easing of interest rate hike expectations, nonferrous metals broadly rose, and nickel prices rebounded from last week's lows. While Indonesia’s nickel ore RKAB quota is expected to be loose, sulfur prices remain elevated above $1,000/mt, providing ongoing cost support. In the short term, the most-traded SHFE nickel contract is expected to trade in the range of 125,000-130,000 yuan/mt.

Indonesia's Ministry of Energy and Mineral Resources (ESDM) has officially released the benchmark mineral price (HMA) for the second half of August 2026. The HMA for this period is as follows: nickel price at US$16,960/tonne, rise from US$16,646/tonne in the first half of August 2026, representing an increase of US$314.00/tonne, or 1.89%. Meanwhile, the benchmark prices for other minerals are: cobalt at US$55,869.00/tonne, iron ore at US$1.41/tonne, and chromite ore at US$6.37/tonne. According to SMM's internal calculation model, based on simulations for pyrometallurgical ore (20% Fe, 1% Cr, 0.05% Co) and hydrometallurgical ore (45% Fe, 2% Cr, 0.10% Co), the benchmark nickel ore prices (HPM) for different grades have changed as follows: - Ni 1.2%: US$46.12/wmt (increase US$0.64) - Ni 1.3%: US$50.42/wmt (increase US$0.72) - Ni 1.4%: US$54.57/wmt (increase US$0.68) - Ni 1.5%: US$59.31/wmt (increase US$0.77) - Ni 1.6%: US$64.28/wmt (increase US$0.86)

[8.17 Morning Meeting Minutes] The overall increase in the US Producer Price Index (PPI) in July remained mild, indicating a further easing of inflationary pressures, and expectations for a US Fed interest rate hike in September cooled further. The most-traded SHFE nickel 2609 contract plunged sharply in early trading, closing the morning session at 127,300 yuan/mt, down 1.12%. The Indonesia Nickel Miners Association (APNI) recommended keeping the 2026 nickel ore RKAB at 270 million wmt and additionally setting a 30 million wmt strategic buffer, bringing the potential total quota to 300 million wmt. With expectations for looser RKAB quotas, nickel prices are expected to remain in the doldrums in the short term, and the trading range for the most-traded SHFE nickel contract is 125,000-130,000 yuan/mt.

[8.11 Morning Meeting Minutes] The National Bureau of Statistics (NBS) released data showing that in July, due to imported factors, the Consumer Price Index (CPI) fell 0.1% MoM but rose 0.5% YoY. Core CPI, which excludes food and energy prices, rose 0.3% MoM and 0.9% YoY, and CPI maintained a mild uptrend overall. The most-traded SHFE nickel 2609 contract moved sideways in the early session, and as of the early session close it was at 129,570 yuan/mt, up 0.33%. Nickel prices are currently in a highly uncertain environment characterized by wild swings in policy expectations, macro headwinds, and geopolitical risks. In the short term, the market is expected to swing wildly, with the most-traded SHFE nickel contract trading within a range of 125,000-133,000 yuan/mt.