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Sulphur 422 Jan-Feb 2026

28 January 2026

Indonesian nickel shutdown signals risk for sulphur demand

INDONESIA

Indonesian nickel shutdown signals risk for sulphur demand

PT QMB New Energy Materials, a major Chinese-owned nickel smelter in Indonesia, is temporarily cutting production due to mounting waste management challenges, according to a 24 November report from local news source Sina, a move expected to temporarily impact regional sulphur demand. The facility, located in the Morowali Industrial Park, will reduce output for at least two weeks as its tailings ponds are nearing capacity while it awaits approval for a new facility. The shutdown may have implications for the sulphur market, as QMB is a major consumer.

The company, which accounts for 12% of Indonesia’s nickel-based acid demand, expanded its sulphur-burning capacity to 1.6 million t/a in 2025. The two-week production halt may curb its sulphur consumption and may place downward pressure on regional demand. While significant, QMB is one of several major HPAL producers in the country, with PT Lygend (30%), Huafei (26%), and Huayue (18%) holding larger shares of acid requirements.

The situation at QMB may set a precedent that concerns sulphur market players. Stricter government enforcement of waste disposal rules means other Indonesian HPAL producers could easily face similar disruptions, introducing a major new uncertainty for the market.

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