Nickel Market Turns Bullish on Tight Supply and Strong Demand

Recording date: 22nd July 2026Canada Nickel Company (TSXV:CNC) CEO Mark Selby used this week's Battery Show appearance to lay out a market backdrop he believes is turning more favourable for nickel producers, alongside an update on his own company's flagship Crawford project.The starting point is price action. Nickel had been range-bound between US$16,000 and US$17,000 a tonne, but has broken through technical resistance following Indonesia's confirmation that it will not make major changes to its 2026 mining quotas. Selby characterises this as a genuine test of Indonesian policy resolve, following weeks of speculation — much of it from short-sellers and Chinese commentary — that Jakarta would loosen restrictions under pressure. That the quotas held, he argues, removes one of the market's clearest downside risks and should force sell-side analysts to keep revising nickel price forecasts higher through the remainder of 2026, following Bernstein's recent move to a small-deficit call for the year.On the supply side, Selby's strongest conviction is around the seasonal decline in Philippine nickel ore output, which historically halves quarter-on-quarter through the third and fourth quarters due to monsoon weather. With Chinese in-process inventories already reduced, this year's seasonal drop is expected to be felt more directly in downstream nickel pig iron and stainless steel pricing. Adding to input-cost pressure, sulphuric acid prices — relevant to HPAL processing — are rising again as conflict in the Gulf region resumes, reversing an earlier easing. Selby points to a cluster of market indicators — stainless steel, NPI, NPI-to-metal discounts and MHP premiums — all sitting only modestly below cycle highs, as evidence the physical market remains tight despite some LME inventory build.On demand, Selby sees EV-related nickel consumption growing at a mid-to-high single-digit pace as the post-2021/22 inventory destocking cycle across nickel, cobalt and lithium comes to an end — lithium prices are already up 30–40% year-to-date on restocking. He frames this as one contributor to broader industrial demand growth of roughly 7% a year since 2019, alongside defence, oil and gas, aerospace and infrastructure build-out across South Asia and the Middle East. Against that backdrop, he argues the pipeline of advanced projects capable of adding meaningful new supply outside Indonesia is thin, naming Centaurus Metals (ASX:CTM), Lifezone Metals (NYSE:LZM), Talon Metals (TSX:TLO), FPX Nickel (TSXV:FPX) and Canada Nickel as the main developers still advancing at scale.On Canada Nickel's own project, Crawford has reached its final permitting milestone: conditions have been published and sent to Canada's federal minister for a decision within 30 days, which would make it the first project permitted under the country's 2019 federal Impact Assessment Act. Selby also touched on exploration progress at First Atlantic Nickel & Cobalt (TSXV:FAN) and permitting and drilling updates at Talon Metals, rounding out a week light on individual company news but heavy on macro signal, in his view.Sign up for Crux Investor: https://cruxinvestor.com