MIND ID Develops Domestic Sulphur Sources to Strengthen Nickel Downstreaming Supply Chain

Indonesia has a strategic opportunity to develop domestic sulphur production amid rising demand from the nickel processing industry and the electric vehicle battery ecosystem. MIND ID, the national mining holding company, has identified the potential utilisation of by-products from copper and gold mining as an alternative sulphur source to support the domestic nickel downstreaming industry. MIND ID Director of Mineral Resource Processing Planning, Budi Santoso, revealed that MIND ID and its holding members are actively inventorying this potential. “We have by-products from copper and gold, such as iron oxide and iron sulphate, which should be able to be processed, treated, and extracted to take the sulphur or to be made into sulphuric acid to meet these needs,” Budi said during a discussion on Indonesia’s Critical Minerals Amid the Global Energy Crisis in Jakarta on Wednesday (17/6/2026). This move is part of MIND ID’s strategy to strengthen its role as a driver of national mineral downstreaming, not only in mining but also in building a more independent supply chain for supporting materials. Sulphur is a critical component in the High Pressure Acid Leach (HPAL) process, the primary technology used to process limonite nickel ore into intermediate products like mixed hydroxide precipitate (MHP), which is used as raw material for electric vehicle batteries. The scale of demand is substantial, with the assumption that producing one tonne of MHP requires approximately 11.7 tonnes of sulphur. The growth of the HPAL industry in Indonesia is directly proportional to the increasing national sulphur demand. This condition makes developing domestic sources a strategic agenda, not merely a cost-efficiency option. Currently, more than 70% of sulphur needs for nickel processing in Indonesia are met through imports, with around 75%–80% originating from the Middle East. Total national sulphur imports reach approximately 5.3 million tonnes per year. “The current condition is that, surprisingly, more than 70 per cent of Indonesia’s nickel sulphur needs are obtained through imports, and that is from an area currently in turmoil in the Middle East,” Budi said. Geopolitical tensions in the region have had a tangible impact on prices. Chairman of the Indonesian Nickel Industry Forum (FINI), Arif Perdana Kusumah, noted a significant price surge in a short period. “The price of sulphur today is 1,200. In April last year, the price was only 250,” Arif said at the Indonesia Critical Minerals forum in Jakarta in early June 2026. In response to these conditions, several nickel downstreaming industry players have begun diversifying import sources to Canada, the United States, and South Korea as a short-term mitigation measure. Beyond sulphur, MIND ID is also mapping other challenges in the national battery supply chain. Budi mentioned that Indonesia still has to import lithium for battery industries based on that material. “This is with the caveat that we have the material. But there are also materials we do not have, for example, lithium-based batteries, where the lithium still has to be imported,” Budi said. Therefore, MIND ID is pushing for the acceleration of research and development of nickel-based battery technology as Indonesia’s comparative advantage. “Since we have nickel, we should push research into how nickel-based batteries can be more efficient than lithium-based ones,” he said. Meanwhile, Executive Director of the Center of Reform on Economics (CORE) Indonesia, Mohammad Faisal, stated that efforts to strengthen the domestic supply chain, as being undertaken by MIND ID, are the right step in the logic of long-term downstreaming. “If we only rely on extraction or initial-stage processing, then when the mineral runs out, the economic benefits will also stop,” Faisal said. According to Faisal, the longer the value chain Indonesia controls, the greater the economic benefits that can be sustained. “The raw materials may no longer be as abundant as before, but we will still have the human resources capable of developing derivative products,” he said. Faisal added that policy consistency is a key factor for downstreaming investment to proceed in the long term. The success of downstreaming, he argued, is not only measured by the construction of smelters but by the ability to create an industrial ecosystem and comprehensively strengthen the domestic supply chain. With the world’s largest nickel reserves and a growing HPAL industrial base, developing sulphur sources from domestic mining by-products is a concrete step that can strengthen Indonesia’s position in the global battery supply chain. This is also important in relation to efforts to reduce exposure to price volatility and geopolitical risks from import dependency.