Amidst a price decline, Australia has added nickel to its list of critical minerals

In an effort to help battery metal producers who are having difficulty with a prolonged decline in prices, Australia has added nickel to its Critical Minerals List.

Six nickel operations have either stopped or reduced their output since the Critical Minerals List was last updated in December, according to Resources Minister Madeleine King, who made the announcement on Friday.

Nickel companies that are listed are eligible to get funding from the government's $2.6 billion Critical Minerals Facility.

Speaking about the government's "proactive" response to the slump, King stated. She added that there were "substantial structural challenges" facing the nickel sector that "cannot be addressed overnight."

Due to a decline in the anticipated growth in the adoption of electric vehicles, Australian producers of lithium and nickel, which are essential components of EV batteries, have been facing difficulties recently.

The economic downturn has uncovered the obstacles Australia must overcome in order to establish itself as a major player in the global energy transition.

Indonesia, which outlawed the export of raw nickel in 2019 in an effort to expand its local processing sector, presents a challenge to nickel producers due to a glut of supply from Chinese-funded businesses. More than half of the world's nickel supply currently comes from this Southeast Asian nation, making it difficult for more expensive suppliers like Australia to compete.

Due to "unfavorable operating conditions" that had led to lowered price assumptions, BHP announced on Thursday that the value of its nickel operations in Western Australia had been significantly revised downward.