Highlights

• Nickel prices plummeted from $48,000 to $15,000 per ton due to Indonesian oversupply and EV battery technology shifts.
• Borsje suggests the price collapse reflects broader systemic dysfunction in global pricing mechanisms, particularly around U.S. dollar benchmarking.
• A quarter of global nickel producers are now operating at a financial loss, signaling significant market disruption.

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In a widely discussed LinkedIn post, Dubai-based Pieter Borsje (opens in a new tab), founder of Eona (opens in a new tab) and a vocal advocate for hard assets, argues that the recent plunge in nickel prices is less a signal of weakening industrial demand than a symptom of systemic dysfunction in global pricing mechanisms.

Nickel has fallen dramatically—from $48,000 to $15,000 per ton—due to oversupply from Indonesia, a shift by EV makers to LFP batteries, and stagnating demand for stainless steel. As Borsje notes, a quarter of global producers are now operating at a loss.

But the real story, he contends, is bigger than nickel. It’s about the erosion of credibility in the U.S. dollar, which continues to serve as the benchmark pricing unit for most industrial metals.

With U.S. interest payments set to exceed $1.1 trillion by 2026, Borsje sees the fiscal spiral triggering a global retreat from investment, infrastructure, and industrial activity, not growth, but contraction to pay for the past.

He warns that as the dollar becomes “a unit of distortion, not value,” pricing signals are breaking down. Nickel’s plunge, then, may reflect a market misfire, not a loss of relevance. After all, nickel remains essential to defense, high-performance alloys, power grids, and next-gen batteries.

“When illusions clear,” Borsje writes, “real assets resurface.”

Counterarguments to the “Nickel Mispricing” Thesis

While Pieter Borsje’s opinion argument about systemic distortion in pricing mechanisms carries rhetorical force, it may overstate the case by attributing too much of nickel’s collapse to macro-monetary dysfunction and not enough to genuine shifts in supply, technology, and industrial strategy.

First, the price drop in nickel is more directly explained by fundamental oversupply than fiat currency distortion. Indonesia’s aggressive expansion of nickel mining and refining capacity, backed by state support and low-cost labor, has created a sustained glut in the market. This is a structural and physical reality, not a monetary illusion. If anything, the price decline reflects a functioning commodity market responding to tangible changes in supply and demand dynamics, not a systemic breakdown.

Second, the technological shift toward lithium-iron-phosphate (LFP) batteries by major EV manufacturers, such as Tesla and BYD, is not simply a transient trend but a deliberate industrial pivot. LFP batteries are cheaper, safer, and no longer as far behind nickel-based chemistries in energy density as they once were. Nickel demand from the EV sector is being structurally cannibalized, not temporarily mispriced.

Third, attributing price movements to a collapsing U.S. dollar overlooks the fact that the dollar has actually strengthened in global currency markets relative to many of its peers, especially during times of economic uncertainty. If anything, a strong dollar puts downward pressure on commodity prices by raising the relative cost of dollar-denominated goods. This doesn’t signal “distortion”—it suggests the market is doing what it’s designed to do: reprice risk and demand under evolving global conditions.

Furthermore, industrial metals like nickel are not only priced in dollars—they are traded on global exchanges with deep liquidity and sophisticated hedging tools. The idea that the entire pricing system has lost credibility implies a far broader breakdown than the evidence supports. Producers and consumers continue to transact, hedge, and invest across currencies and platforms without a collapse in trust.

Note nickel itself is not a mineral nor a rare earth element, but it is a key component of various minerals. Nickel is a chemical element, a naturally occurring metal with a silvery-white, shiny appearance. While nickel can exist in its pure metallic form, it is more commonly found in combination with other elements, particularly sulfur, arsenic, and iron, to form minerals like pentlandite (opens in a new tab), nickeline (opens in a new tab), and millerite (opens in a new tab). 

Join the Unfolding Debate

Rare Earth Exchanges raises the critical question for the mindful to ponder: does a monetary system increasingly misprice industrial metals—nickel included—under growing strain? According to this hypothesis, as metal markets decouple from real-world utility, the case for strategic stockpiles, new pricing mechanisms, and alternative benchmarks becomes stronger. Yet we include counterarguments that are just as likely. What do you think? See the REEx Forum (opens in a new tab).

Source: Pieter Borsje via LinkedIn, June 2025; Rare Earth Exchanges LLC