Nornickel reroutes shipments via Africa as Iran war disrupts metals trade

Saturday 18 April 2026 - 13:14

By: Dakir Madiha

Nornickel reroutes shipments via Africa as Iran war disrupts metals trade

The war in Iran is reshaping global metal supply chains and forcing major producers to overhaul logistics. Nornickel, the world’s largest palladium producer and a key supplier of nickel and copper, has redirected all maritime shipments away from the Suez Canal. The company now routes exports around Africa, extending delivery times by about three weeks and increasing freight costs.

The shift reflects mounting risks across critical shipping corridors in the Middle East. Company executives said shipments previously alternated between the Suez Canal and the African route depending on conditions. That flexibility has ended. All cargo now follows the longer African route to avoid escalating security threats linked to the conflict.

Despite logistical disruptions, demand for base metals has remained broadly stable. Higher global prices have offset rising transport costs. China remains the dominant destination for Nornickel exports, accounting for roughly half of total sales. Russia represents about 15 percent, while the United States takes close to 5 percent.

The wider metals market is under pressure following the closure of the Strait of Hormuz after US and Israeli strikes on Iran. The shutdown has removed a vital maritime artery that carries around 20 percent of global oil and liquefied natural gas trade. The disruption has triggered a broad repricing of commodities. Aluminium prices are expected to approach $3,450 per tonne in the second quarter, near historic highs, as Gulf producers face production interruptions. Iran’s earlier strike on a major regional aluminium producer added to supply instability.

Forecasts now point to rising commodity prices across the board. More than two-thirds of raw materials are expected to see price increases in 2026, marking a sharp shift from earlier projections of stable markets. Analysts attribute the change to prolonged geopolitical tensions and tightening supply chains.

Indonesia’s nickel sector faces simultaneous constraints. Authorities have reduced mining quotas for 2026 to between 260 and 270 million metric tonnes, down sharply from last year’s 379 million. At the same time, a sulfur shortage linked to the Iran conflict has forced several nickel processors to cut output by at least 10 percent. Over two-thirds of Indonesia’s sulfur imports originate from the Middle East, making the industry vulnerable to regional disruptions.

Price forecasts for nickel have been revised upward. Estimates for 2026 now stand at $16,600 per tonne, reflecting a firmer pricing environment. Futures on the London Metal Exchange recently climbed to $18,250 per tonne after a daily increase of nearly 3 percent. However, a growing global surplus of refined nickel, projected at around 324,000 tonnes in 2026, is expected to limit sustained price gains. Market direction will depend largely on supply dynamics in Indonesia, even as geopolitical tensions continue to shape short-term sentiment.