RESEARCH — Nov. 05, 2025
Indonesia – Mining by the numbers, 2024
In 2024, Indonesia reinforced its position as the world's leading nickel producer, commanding over 60% of global output and maintaining strong production and exploration activities in copper, gold and cobalt. Indonesia demonstrated exceptional cost competitiveness, with an all-in sustaining cost (AISC) for copper production at $1.72/lb of paid copper, which is among the lowest globally.
While Indonesia's average emission intensity for copper production exceeded the global average in 2024, emissions are projected to drop 21% by 2030 compared to 2021 levels. Regulatory changes, such as the shift to annual mining quotas and stricter environmental law implementation, may introduce planning uncertainties and temper production growth.
Indonesia remained the leading country in exploration in the Pacific-Southeast Asia region for six consecutive years, with an annual exploration budget averaging $126 million from 2019 to 2024.
– Indonesia produced 2.28 million metric tons of nickel in 2024 — more than half of the global production — and accounted for 4.28% of copper and 11.65% of cobalt production globally.
– The country's AISC for copper production was one of the lowest in 2024, at $1.72/lb.
– Indonesia's nickel AISC margin in 2024 closed at $3,047 per metric ton, and will remain positive through 2025, keeping local producers profitable amid the falling nickel price.
– Indonesia's $113.8 million exploration budget in 2024 was heavily skewed toward low-risk minesite activities, with $80.3 million allocated to expanding resources at or near existing operations.
Indonesia ranks as the world's largest nickel producer for 2024, and its dominance in nickel production has significantly influenced global market dynamics. The bearish and oversupplied environment makes it unfavorable for high-cost regions to maintain operations, as seen in BHP's recent suspension of its Nickel West operations and the West Musgrave nickel project in Western Australia. These closures are all attributed to the oversupply of nickel out of Indonesia.
By October 2025, Indonesia's government requires all mining companies to submit applications for annual mining production quotas for their 2026 operations, as the government shifts back from three years to a one-year approval cycle for better management of production volumes amid falling commodity prices. While the country's increasing regulatory scrutiny will moderate its nickel output growth over the short and medium terms, Indonesia is still projected to more than double its production over the next decade to an estimated 4.97 MMt by 2035.
The AISC margin — a measure of profitability — is the difference between the metal market price and the AISC. Indonesia's nickel AISC margin in 2024 remains positive but lower than that of its regional peers, including the Philippines and China. And in 2025, the country's nickel margin is anticipated to decrease further by 38%, as the London Metal Exchange three-month nickel price is estimated to drop to $15,478/t by 2025 from $17,052/t in 2024. Indonesia's positive nickel margin indicates that local nickel producers are maintaining profitability despite cost pressures.
Beyond nickel, Indonesia also plays an increasingly key role in the critical minerals industry. From 2024 to 2030, the country will drive a rising production share for alumina, aluminum and bauxite while maintaining its position as a major player in copper, gold and cobalt production. The country is ranked seventh globally for copper production in 2024, producing 983,000 metric tons of copper. Along with its massive production, Indonesia maintains one of the lowest AISCs at $1.72/lb of paid copper produced. This is attributed to economies of scale — particularly at the Grasberg mine — low energy costs and, notably in 2025, lower treatment charges.
The low energy cost is a direct result of coal being the country's primary electricity production source, as it is an affordable and reliable fuel in processing powered captive coal-fired power plants. However, coal is also one of the power sources with the highest emissions. Based on our 2024 copper emissions curve, Indonesia has an average emission intensity of 2,535 kilograms of CO2 equivalent per metric ton of copper (kg CO2e/t Cu), above the global average of 2,495 kg CO2e/t Cu. By 2030, Indonesia's average copper mine emission is expected to drop 21% from 2021 levels, signaling a transition to cleaner energy with a noticeable increase in natural gas, hydro and renewables in the country's power mix.
Beyond the push to lower emissions, long-term supply constraints place a strategic premium on resource development, exemplified by Indonesia's exploration budget and efforts to develop its future pipeline. In 2024, Indonesia's exploration budget totaled $113.8 million, accounting for 35% of the Pacific-Southeast Asia region's total allocation. The majority of Indonesia's budget was directed toward gold (58%) and copper (24%), with nickel receiving 16%. Notably, minesite exploration had the largest share, surging to 71% of the country's exploration budget in 2024, from 52% in 2023. This focus on expanding resources at or near existing operations indicates a strategic preference on lower-risk, quicker-return investments that leverage existing infrastructures and extend the life of producing assets. The trend reflects a broader risk-averse attitude among explorers globally, and Indonesia is no exception. However, it is worth noting that while the country hosts a robust exploration development, companies will have to keep pace in developing toward production, as Indonesian mines take 19 years to start up from discovery to production, one of the longest lead times globally.
This article was published by S&P Global Market Intelligence and not by S&P Global Ratings, which is a separately managed division of S&P Global.