On February 15, 2026, at the signing ceremony in Jakarta, a screen connected multiple cities in China and Indonesia. On the screen, Chen Xuehua, Chairman of Huayou Cobalt, and Chen Yijun, Chairman of PT Daaz Bara Lestari, have a video connection; On the other end of the screen, Liu Jincheng, Chairman of EVE Energy, solemnly wrote on behalf of the three parties. At this moment, a cooperation framework agreement on the lithium battery industry chain has officially come into effect.

On the other end of the contract are the two giants of the Indonesian government - ANTAM and IBC. Four parties are working together to build an integrated battery industry from mining to recycling in Indonesia, with products supplied to the domestic market, regional markets, and even the global market. This is not only a crucial step in Huayou Cobalt's globalization strategy, but also a new footnote for China's new energy industry chain to go global.

Three party collaboration, closed-loop industrial chain

The protagonist of this cooperation agreement is HYD, a subsidiary of Huayou Cobalt. This company was jointly established by Huayou Cobalt, EVE Energy, and PT Daaz Bara Lestari, and the equity structure itself implies a deep binding of the industrial chain. According to the agreement, all parties will build an integrated battery industry in Indonesia, creating a power and energy storage battery production base for Indonesia.

From the deployment perspective, the project covers mining, metal smelting, precursor and positive electrode material manufacturing, battery manufacturing, battery recycling and other links, forming a closed-loop chain. This means that everything from nickel mining to the batteries used for final loading, and even to the recycling and regeneration after retirement, can be completed in Indonesia. This upstream downstream collaborative model not only helps Huayou Cobalt consolidate its industry position, but also enhances Indonesia's attractiveness to global new energy enterprises and establishes one-stop solution capabilities.

On the technical level, Huayou Cobalt has launched joint innovation with its partners, focusing on the reform of battery materials and processes in research and development. Typical technologies include the application of high-pressure acid leaching in nickel resources and high nickel ternary mass production technology. By investing in technology to drive product performance and quality, we can manufacture high-energy density and high safety batteries that meet market demands. At the same time, by combining the manufacturing processes of both parties with Indonesia's local resource advantages, we can promote Indonesia's energy transformation and create a barrier for Chinese companies to go global.

The situation is good, strike while the iron is hot

Indonesia has always been a key focus of Huayou Cobalt's efforts. The majority of the company's revenue comes from overseas, and since 2022, the company's overseas market share has exceeded the domestic market by about 60%, higher than peer companies. This achievement is due to Huayou Cobalt's more than 20 years of overseas cultivation - the company began to go global in the second year after its establishment. The first project was to invest in Africa in 2003, gradually opening up other markets and improving the industrial chain with African products.

In this process, Huayou Cobalt has established a strong customer system and closely cooperated with multiple overseas car companies, including Volkswagen, BMW, Foton, etc., and successfully entered Tesla's supply chain as its battery material supplier.

In Indonesia, going it alone is not the best choice. Huayou needs a partner to work together, so Yiwei Lithium Energy, which also needs to open up the market, has become a target for cooperation. The two have jointly landed in Indonesia to create a joint venture project. This cooperative relationship is also continuously deepening - in November 2024, EVE Energy placed an order for 127800 tons of ultra-high nickel ternary cathode materials with Huayou Cobalt, which will be operated by Huayou Hungary's subsidiary.

With its deep layout, Huayou Cobalt has achieved remarkable results in the fierce competition of the lithium battery industry. In 2024, the company's net profit increased by about 50% year-on-year, and it successfully passed the adjustment period of the supply and demand pattern in the past two years without encountering significant performance fluctuations. The key to stable performance lies in the diversified layout of the main business - although it started with cobalt, the weight of cobalt resource business is not high. Nickel products are currently the main source of revenue, accounting for one-third of the revenue in the first half of 2024, and lithium product business also has a certain proportion.

'Demon Nickel' Helps Highlight Value

Although Huayou Cobalt Industry is still called "Cobalt Industry", it is already a company mainly engaged in nickel mining. In the second half of 2024, the "demon nickel" market reappeared, adding a lot of heat to this company. Taking February 2, 2025 as an example, domestic Shanghai nickel futures were simultaneously locked down by the limit down, increasing uncertainty in the supply side of the industry chain. The specific quota approval system for Indonesian nickel mine RKAB has not been implemented yet, disrupting the market rhythm and causing increasing concerns. But the more uncertain it is, the more it proves the precious value of Huayou Cobalt Industry at this time.

The advantage of being a mineral rich country is crucial at this moment. The approval progress and final quota of RKAB quota for Indonesian nickel mines can basically control the future trend of nickel mines. Relevant institutions even estimate that the RKAB quota for nickel mines in 2026 may only be 250 million to 260 million tons. The severe tightening of supply will inevitably lead to a surge in prices, making Huayou Cobalt an even more sought after commodity.

The Indonesian government's goal is already clear: to balance prices with RKAB quotas. The approved quota for 2025 is significantly higher, so there is no doubt that it will be tightened in 2026. The reduction of quotas will significantly improve the global nickel market structure, and from mid December 2024 to January 2025, the stock price of Huayou Cobalt has risen significantly.

However, although Indonesia has control over nickel exports, its industrial foundation is weak and high-quality nickel products are always scarce. For example, it is difficult to effectively convert secondary nickel into primary refined nickel and battery grade nickel sulfate, and the technological bottleneck must rely on the production lines of several major material giants to break through. Moreover, only ternary batteries require nickel ore, while lithium iron phosphate batteries do not. In the current unfavorable market share of ternary batteries, even if the Indonesian government forcibly restricts the raw material end, it will not pose a serious threat to most battery factories in China. The structural contradictions and downstream demand will remain balanced, and the Indonesian government is well aware that relying solely on nickel ore export checkpoints is not a long-term solution. It needs to simultaneously compete with manufacturers and introduce domestic high-end production lines.

The advantage of Huayou Cobalt lies in its core technology and control over the material end. Both China and Indonesia welcome such technology companies to settle in. The more scarce the raw materials, the more likely Huayou will focus on high-end product research and development. In the coming years, Huayou Cobalt needs to maintain a balance in geopolitical games and satisfy its own interests and needs with different contradictions. Editor/Yang Beihua