Over the past few days, the Indonesian nickel market has reacted to the government’s announcement of a restricted 2026 RKAB production quota, set at approximately 260–270 million tons. This reduction has sent shockwaves through the industry, sparking widespread concern among both operational and upcoming smelters. Stakeholders are increasingly worried that these tightened supply levels will be insufficient to sustain their long-term production requirements. For the first one, The Indonesian Nickel Miners Association (APNI) has stated that the Ministry of Energy and Mineral Resources (ESDM) has agreed to consider revisions to the 2026 Work Plan and Budget (RKAB) starting in July. It is believed that the RKAB revisions could increase nickel production quotas by 25% to 30%. According to APNI, the domestic smelter demand based on the capacity is around 380-400 million tons, With the existing RKAB quota at 270 million tons and projected imports from the Philippines at 23 million tons, this 30% adjustment is critical to meeting the national ore deficit. This potential for more quota provides some relief to the market, but there is a second, more pressing issue to consider Another media also stated that The Indonesian Ministry of Energy and Mineral Resources (ESDM) has set a conservative nickel ore production target of 209.08 million tons for 2026, a figure notably lower than the approved RKAB quota of 260–270 million tons. According to Siti Sumilah Rita Susilawati of the Directorate General of Minerals and Coal, this strategic reduction is intended to preserve national reserves and stabilize global commodity prices As a result, the sudden perception of even deeper quota cuts has fueled confusion across the Indonesian market, which might further intensifying the pressure from already spiking nickel ore prices. I. Indonesia’s Calculated Nickel Ore Demand in 2026 According to SMM’s latest calculations, the total nickel ore requirement for 2026, which includes the demand from NPI, FeNi, Nickel Matte, and MHP, is estimated at approximately 334 million tons, based on the production estimates of smelter's current condition. This sharp increase is primarily driven by the rapid expansion of MHP production, which utilizes higher volumes of limonite ore. This surge in consumption has intensified the pressure on smelters to secure significantly higher mining quotas. II. Current Update and Understanding The Quota Revision? According to current understanding from the Regulation of the Minister of Energy and Mineral Resources Number 17 of 2025, citing the 11 th Article Regarding the Amendment of Work Approved Quotas in ESDM, it is stated that: Article 11 (1) Holders of an IUP (Mining Business License) for the Exploration stage, holders of an IUPK (Special Mining Business License) for the Exploration stage, holders of an IUP for the Production Operation stage, holders of an IUPK for the Production Operation stage, or holders of an IUPK as a Continuation of Contract/Agreement Operations may submit one (1) application for an amendment to the Exploration stage RKAB or the Production Operation stage RKAB in each current year. (2) The application for the RKAB Amendment as referred to in paragraph (1) shall be submitted after the holders of the Exploration stage IUP, Exploration stage IUPK, Production Operation stage IUP, Production Operation stage IUPK, or IUPK as a Continuation of Contract/Agreement Operations have submitted periodic reports up to the second quarter or no later than July 31st of the current year. SMM observes that RKAB revisions and amendments are standard procedure, as seen in both 2024 and 2025. This year, however, the submission window for revisions is expected to open after June, with a final deadline of July 31st. While the ESDM has not clarified whether the 260–270 million ton target already accounts for these mid-year adjustments, it remains highly likely that these revisions will be sufficient to meet domestic smelter demand. Another Potential Cuts? According to SMM’s further communication with ESDM, the predicted quota for 2026 still remains on 260-270 million tons estimate. Since the further production cuts rumor by ESDM is not in an official setting announcement, it is hereby confirmed that the quota approved of 2026 will not be lower than ESDM’s initial estimate of 260-270 million tons. From SMM's understanding, the target number to be lower than the quota is merely just an estimate of the production target, not necessarily reflecting the actual production numbers. III. Nickel Ore Supply and Demand Given the government’s push to tighten annual quotas, SMM expects this year’s revisions to land at approximately 20%, a more conservative number. Furthermore, nickel ore imports from the Philippines are unlikely to see significant growth compared to 2025, with estimates holding at approximately 19 million tons. This stagnant growth is due to the heavy concentration of Philippine exports to China, coupled with limited domestic mining capacity and a lack of new mining companies . After factoring in import volumes from the Philippines, the nickel ore market is likely to remain in a tight supply-demand balance, especially with potential hurdles like the rainy season slowing down mining operations. Nonetheless, this scenario is much more realistic than the alternative: a massive 50+ million ton deficit that would occur if the total quota were strictly capped at 270 million tons. IV. Conclusion Overall, the signal for significant quota cuts at the start of the year has already triggered a sharp rally in nickel ore prices, which could be seen from the substantial rise in premiums, largely driven by quota reductions at major mining companies and persistent uncertainty among small-to-mid-scale operators. Looking ahead, if the government maintains these restricted levels and fails to approve adequate supplemental quotas, domestic ore prices are poised for further upward momentum, potentially intensifying the cost burden on the downstream smelting sector.

The global strategic resource reserve system is undergoing rapid restructuring, and a resource security battle centered on critical minerals has quietly begun.

When Trump announced the launch of a $12 billion "Gold Reserve Plan" at the White House to procure and stockpile critical minerals such as rare earths, gallium, and cobalt for manufacturers, the China Nonferrous Metals Industry Association (CNIA) was also studying the inclusion of copper concentrates in the national reserves. The global strategic resource reserve system is undergoing rapid restructuring, and a resource security battle centered on critical minerals has quietly begun. In early February 2026, the world's two largest economies almost simultaneously announced strategic reserve plans for critical minerals. The Trump administration officially launched a $12 billion critical mineral reserve project named the "Gold Reserve Plan." This plan aims to establish a 60-day emergency mineral reserve, utilizing $10 billion in loans from the US Export-Import Bank and approximately $2 billion in private capital to procure and stockpile critical mineral resources such as rare earths, gallium, and cobalt. From the EU’s Critical Raw Materials Act setting clear recycling rate targets to the US’s tax incentive policies, a global policy network covering legislation, subsidies, and standards is taking shape. For China, the recycling industry of rare and precious metals is not only a vital component of resource security but also a key link in achieving the "dual carbon" goals and ensuring supply chain autonomy and control.

Poland's central bank plans massive gold purchase despite record prices, potentially pushing bullion to 30% of total national assets.

[SMM Lead Morning Meeting Minutes: Pre-Holiday Market Trading Weakens, Lead Prices Expected to Remain in the Doldrums] The US House of Representatives passed a funding agreement negotiated by President Trump and Senate Democrats. Recently, the lead market has been increasingly influenced by the Chinese New Year atmosphere, with downstream lead-acid battery enterprises successively preparing to suspend operations for the holiday, leading to a decline in trading activity in the lead market...

In this historic bull market for gold, the "gold-buying spree" by central banks worldwide is undoubtedly a key driving force behind the rise in gold prices. Although the true scale of gold purchases by these "central bank moms" remains a mystery, few industry insiders believe they will stop in the future... According to estimates by Goldman Sachs analysts, central banks globally are currently adding roughly 80 mt of gold each month—valued at approximately $8.5 billion at current prices. Most of these purchases are conducted privately and secretly. Data from the World Gold Council also leads to a similar conclusion: Central banks and sovereign wealth funds are currently "sweeping up" approximately 1,000 mt of gold annually, equivalent to at least a quarter of the world's annual gold mine production. A survey conducted by HSBC in January this year among 72 central banks revealed that more than one-third of the respondents plan to buy more gold in 2025, with none intending to sell. During periods of geopolitical tension, gold often serves as a safe haven. Although this buying spree began before US President Trump launched a global trade war, it still underscores the growing concerns of some countries about over-reliance on the US dollar, the world's dominant reserve currency. The scorching rally in gold prices over the past few years has only further increased the allure of the precious metal. A prime example is that, the National Bank of Kazakhstan was among the largest gold sellers among global central banks last year. However, according to Governor Daniyar Akishev of the National Bank of Kazakhstan, the bank has reverted to being a net buyer this year and plans to continue increasing its reserves. Akishev stated, "Gold is often seen as a safe-haven asset, but in the current circumstances, considering all the panic, tariffs, and reshaping of global trade, it has also become an investment asset." Is there a "shortcut" to $6,000? For Goldman Sachs, the belief that the gold-buying spree by central banks will continue is the main reason for the bank's persistence in its forecast of $3,700 per ounce by the end of the year. As of Wednesday's Asian session, spot gold prices were recently trading near $3,365, not particularly far from the historical peak of $3,500 set in April. From the perspective of global central bank activities, after the Russia-Ukraine conflict in 2022 led the US and its Western allies to freeze Russia's foreign exchange reserves, the pace of gold purchases by "central bank moms" worldwide nearly doubled. This move to "weaponize finance" has prompted many central banks to consider diversifying their reserves, while the renewed threat of inflation and speculation that the US government may not be as accommodating to foreign creditors have further highlighted gold's appeal to policymakers. Adam Glapiński, governor of the National Bank of Poland, one of the largest gold buyers in recent years, said, "Gold is the safest reserve asset. It has no direct link to the economic policies of any country, can withstand crises, and can maintain its real value over the long term." Massimiliano Castelli, managing director at UBS Asset Management, which provides strategic advice to many central banks, said, "In addition to the risk of sanctions, earlier this year, speculation that the Trump administration would deliberately pursue a policy of devaluing the US dollar, as well as threats to the independence of the US Fed, have made some institutions uneasy." Castelli said, "Given the threats to the US dollar, its share in international reserves may face a sustained decline—perhaps slightly faster than the pace we have seen in the past few years, as central banks are diversifying into other currencies and gold." That said, with limited issuance of bonds denominated in other currencies, central banks have limited options when seeking diversification. However, the growing inflow of funds into gold has become an inevitable trend and may further support the rally that began in late 2022, when gold prices doubled. According to JPMorgan Chase, even if only 0.5% of foreign-held US assets are shifted into gold in the coming years, it would be enough to drive gold to $6,000 per ounce by 2029. Evy Hambro, head of thematic and sector investing at BlackRock, said, "The gold market is large, but the US dollar market is even larger. Even a small amount of funds flowing from the US dollar market into gold would have a significant impact."

The latest foreign exchange reserve data was released today. As of the end of April, China's foreign exchange reserves stood at approximately $3,281.7 billion, an increase of $41 billion compared to the end of March. Experts pointed out that the "reciprocal tariff" introduced by Trump in April caused the US dollar index to drop by about 4.4%, leading to a rise in the price of non-US dollar assets in China's foreign reserves. In addition, the central bank continued to increase its gold holdings in April, with gold reserves reaching 73.77 million ounces by the end of April. Experts stated that the central bank's increase in gold holdings aligns with market expectations. From the perspective of optimizing the international reserve structure and promoting the internationalization of the yuan, the central bank's increase in gold holdings remains a major trend. Recent gold price fluctuations have been significant, and experts noted that the current gold price has reached a new level. Given the rapid market changes, the amplitude and frequency of gold price fluctuations are expected to increase in the short term and the future. Experts also warned that the risks of gold investment have increased, and investors should adopt a conservative approach. Foreign exchange reserves rose by $41 billion in April. According to statistics from the State Administration of Foreign Exchange, as of the end of April 2025, China's foreign exchange reserves amounted to $3,281.7 billion, an increase of $41 billion compared to the end of March, representing a rise of 1.27%. In April, the Trump administration introduced "reciprocal tariffs" globally, intensifying expectations of a US recession and causing funds to flow into non-US markets, which led to a significant drop of about 4.4% in the US dollar index for the month. The decline in the US dollar resulted in an increase in the price of non-US dollar assets in China's foreign reserves. Wang Qing, chief macro analyst at Oriental Jincheng, pointed out that the substantial increase in foreign exchange reserves in April was mainly driven by the significant drop in the US dollar index. It is estimated that this factor contributed to an increase of about $50 billion in foreign exchange reserves in April. At the same time, after the US introduced "reciprocal tariffs" in April, global capital markets experienced severe volatility. Among them, major market stock indices mostly declined. This offset the impact of lower US bond yields and rising US bond prices, exerting a slight downward pull on the valuation of China's foreign reserve assets. The April Politburo meeting proposed to "focus on stabilizing employment, enterprises, markets, and expectations, and use the certainty of high-quality development to cope with the uncertainty of drastic changes in the external environment." On May 7, the central bank, the Financial Regulatory Authority, and the China Securities Regulatory Commission quickly implemented the Politburo meeting's work deployment and jointly launched a "package" of financial policies to support market and expectation stability. "Currently, the international economic and trade situation is complex and severe. China is actively taking on the responsibility of a major country, upholding multilateralism, and strengthening communication and cooperation with neighboring countries and regions such as the EU. In the short term, this helps mitigate the risk of a decline in exports to the US. In the long term, China's advantage in the entire industry chain is irreplaceable, and its international competitiveness in goods is strong. Exports will continue to play a fundamental role in stabilizing cross-border capital flows."Wen Bin, chief economist at China Minsheng Bank, stated that China's domestic macroeconomic situation will continue to improve steadily with strong policy support, laying a solid foundation for maintaining an overall balance in the balance of payments and keeping the scale of foreign exchange reserves basically stable. PBOC Increases Gold Reserves for Six Consecutive Months In terms of gold reserves, data shows that as of the end of April, China's gold reserves stood at 73.77 million ounces, up 70,000 ounces MoM. This marks the sixth consecutive month that the PBOC has increased its gold reserves. "There are signs of more structural shifts in gold allocation, such as Beijing allowing insurance funds to invest in gold, and global central banks are systematically increasing the share of gold in their total reserves," UBS Wealth Management predicts that central banks worldwide will purchase approximately 1,000 mt of gold in 2025, with net purchases by exchange-traded funds (ETFs) expected to reach 450 mt. Recently, gold prices have experienced significant volatility. On April 22, international gold prices briefly surpassed the $3,500/ounce mark before jumping initially and then pulling back, subsequently falling below $3,400 and $3,300, and hitting a low of $3,273/ounce on April 23. As of today, spot gold is trading at $3,372.28/ounce. "Investors and consumers have recently perceived gold prices as highly volatile because the base price of gold is now so high," Wang Lixin, CEO of the World Gold Council in China, told Caixin reporters, noting that a 5% fluctuation in gold prices is normal. However, the current base price of gold is too high. Wang Lixin also stated that the current rise in gold prices has reached a new level, and with the rapid changes in market conditions, the amplitude and frequency of gold price fluctuations will definitely increase in the short term and in the future. While the percentage changes may seem small, the actual changes will be significant. "This volatility also serves as a risk warning to investors and consumers that the risks associated with gold investment have increased significantly. In this situation, investors should adopt a relatively conservative approach. Especially for non-professional investors, they should avoid using high leverage to invest in gold." The industry generally expects that gold will remain well-supported due to ongoing tariff and geopolitical uncertainties. However, Jerry Chen, a senior analyst at GAIN Capital, believes that in the short term, the pressure on gold prices will come from whether the US Fed cuts interest rates. "If interest rates remain unchanged this week, coupled with progress in trade negotiations, it is expected to help the US dollar index stop falling and begin to rebound, while keeping gold prices under continued pressure."

The latest data from the State Administration of Foreign Exchange shows that China's foreign exchange reserves stood at $3,240.7 billion at the end of March, an increase of $13.4 billion from the end of February, marking the second consecutive monthly increase this year. Experts told Cailian Press that the US dollar index fell by 3.2% in March, and factors such as exchange rate translation and changes in asset prices contributed to the increase in China's foreign exchange reserves compared to the previous month. In addition, the latest data also shows that the PBOC has been increasing its gold holdings for five consecutive months, with gold reserves reaching 73.7 million ounces by the end of March. Industry analysts told Cailian Press that the central bank's continued increase in gold holdings remains a major trend. Recently, spot gold prices have consolidated after breaking through $3,000, and analysts also told Cailian Press that the large fluctuations in gold prices reflect market anxiety. While gold prices are supported by multiple factors, the possibility of a pullback should also be noted. Foreign exchange reserves increased by $13.4 billion in March. Data from the State Administration of Foreign Exchange shows that as of the end of March, China's foreign exchange reserves stood at $3,240.7 billion, an increase of $13.4 billion from the end of February, a rise of 0.42%. Wen Bin, chief economist at China Minsheng Bank, told Cailian Press that in March, influenced by macroeconomic data, fiscal and monetary policies, and expectations of major economies, the US dollar index fell, and global financial asset prices showed mixed performance. Under the combined effects of exchange rate translation and changes in asset prices, China's foreign exchange reserves increased by $13.4 billion compared to the previous month. Specifically, in terms of currencies, the US dollar index fell by 3.2% to 104.2, while non-US dollar currencies generally appreciated. In terms of assets, the dollar-denominated hedged global bond index fell by 0.4%, and the S&P 500 stock index fell by 5.8%. "Currently, external instability and uncertainty have significantly increased, but China's economic foundation is stable, with many advantages and great potential. There are ample macro-control reserve tools and policy space, which are conducive to unleashing huge domestic demand potential. At the same time, with the diversification of China's foreign trade regions, the upgrading of trade structures, and the continuous improvement in the attractiveness of RMB assets to foreign investors, China's international balance of payments will remain stable, laying the foundation for the basic stability of foreign exchange reserves," Wen Bin also said. The PBOC continues to increase gold holdings. In terms of gold reserves, data shows that China's gold reserves stood at 73.7 million ounces at the end of March, compared to 73.61 million ounces at the end of February, marking the fifth consecutive month of increased gold reserves by the central bank. Qu Rui, deputy director of the Research and Development Department at Oriental Jincheng, told Cailian Press that the PBOC has been increasing its gold holdings for five consecutive months, while international gold prices have risen significantly during the same period, indicating that the central bank's increase in gold holdings is not driven by cost control but more by optimizing the structure of international reserves. The future trend for the PBOC to increase gold holdings remains a major direction. Recently, gold prices have shown significant fluctuations. On March 14 and 17, spot gold prices broke through $3,000 per ounce twice during the day; on April 3, spot gold approached $3,150 per ounce, hitting a record high; on April 7, spot gold fell below $3,000 per ounce but then turned positive during the day, reaching $3,040 per ounce around 9 a.m. "This morning, gold prices showed significant fluctuations, reflecting market anxiety," Wang Yi, a gold investment analyst at Guohua, told Cailian Press. From a fundamentals perspective, the double-edged sword of trade wars and inflation is long-term bullish for gold. On one hand, US import costs rise under tariffs, highlighting gold's anti-inflation properties; on the other hand, geopolitical risk premiums indirectly benefit gold. However, there is also the possibility of a pullback recently, along with bearish factors such as a stronger US dollar and repeated US policy changes. Qu Rui also said that in the medium to long term, the implementation of tariff policies does not mean that short-term benefits are exhausted. Future gold trends will still be driven by several factors: "First, the uncertainty of Trump's tariffs will continue to ferment, and the strong market risk aversion will provide strong support for gold; second, the unexpected reciprocal tariffs will exacerbate concerns about the risk of 'stagflation' in the US in the medium to long term, and gold's anti-inflation properties will continue to push its prices higher; third, global central banks still have a strong willingness to allocate gold; fourth, global geopolitical risks remain significant, which will further increase market demand for risk aversion and support gold." The World Gold Council believes that the breakthrough of gold prices above $3,000 is of great significance. "Although gold prices may fluctuate in the short term, the key factor determining the next step in gold's trend is whether the fundamentals can provide long-term support for its trend. Gold investment demand will continue to be supported by a combination of geopolitical and geo-economic uncertainty, rising inflation, expectations of interest rate cuts, and a weaker US dollar."

The purchase of gold by central banks of many countries, the safe-haven demand brought about by geopolitical conflicts and the market's enthusiasm for going long are still continuing, and COMEX gold continued to set a new high on April 9.

Domestic cobalt sulphate output stood at 8,391 mt in metal content in July, up 12% MoM and a growth of 33% YoY.