Several Indonesian nickel smelters controlled by Chinese firms are weighing coordinated output cuts of a key battery material, as pressure mounts on profitability due to weak prices, according to people familiar with the matter. Senior executives with companies including Tsingshan Holding Group Co., GEM Co., Lygend Resources & Technology Co. and Zhejiang Huayou Cobalt Co. have met in the past week to discuss lowering operating rates at their high-pressure acid leaching plants in the country, said the people, who aren’t authorized to speak publicly.

The potential cuts reflect ongoing struggles in the global nickel market, where prices have slumped amid oversupply concerns and slowing demand from the electric vehicle sector. The smelters under discussion are among the largest producers of Class I nickel, a premium grade used in lithium-ion batteries.

If implemented, the coordinated reductions could tighten supply and provide some support to prices. However, industry analysts note that broader market dynamics, including Chinese economic conditions and EV production forecasts, will likely continue to weigh on sentiment.