Risks of Sourcing Nickel from Alternative Suppliers

U.S. Department of Labor adds Chinese-Indonesian Produced Nickel on Forced Labor List The U.S. Department of Labor updated its "List of Goods Produced by Child Labor or Forced Labor," which now includes 204 goods from 82 countries, with 11 new additions such as cotton from China and Vietnam. These updates reflect ongoing concerns in industries like agriculture, textiles, and mining, where labor exploitation persists. To support efforts to address these abuses, the department launched new digital tools that aim to help governments, businesses, and NGOs enhance their efforts in combating child and forced labor, encouraging global cooperation to drive policy changes and better worker protections worldwide.  Additionally, according to Asia Times, the U.S. Department of Labor has also listed Indonesian nickel as a product potentially made with forced labor, citing reports of worker abuse in Chinese-Indonesian nickel smelters. Workers, including Chinese laborers, allegedly face wage deductions, unsafe conditions, forced overtime, and passport confiscation. The issue threatens Indonesia's ambitions to dominate the electric vehicle (EV) battery supply chain, as U.S. companies may avoid sourcing nickel from Indonesia due to regulatory and ethical concerns, complicating both U.S. and Indonesian economic goals.

The PT QMB nickel plant in Indonesia just restarted, barely two months after a deadly landslide killed three workers. It’s part of a worrying trend. Since 2015, there’ve been 114 reported accidents in Indonesia’s nickel sector, with 101 deaths and 240 injuries. Nearly half of those happened at one site: the Indonesia Morowali Industrial Park (IMIP). In 2023 alone, a smelter explosion at IMIP killed 21 and injured 38. Yet production barrels on, driven by the global demand for EVs and green tech. The industry leans heavily on HPAL technology, efficient but tailings-intensive and clearly, safety is lagging far behind. We’re seeing lives lost and communities devastated in the name of sustainability. As we push for electrification and cleaner energy, we can’t look the other way. Supply chains must be held to the same standards we demand for emissions human rights, safety, and transparency included. Sources: Bloomberg – https://lnkd.in/gGi6tw47 Mongabay – https://lnkd.in/gpfx3gym Business & Human Rights Resource Centre – https://lnkd.in/gqc5T3ws Mining-Technology – https://lnkd.in/gH9N_a2A

🔋🌏 Nickel, EVs, and Supply Chain Responsibility — What links Indonesia, China, and Germany? A new study from Rosa Luxemburg Stiftung (nice name) and PowerShift e.V. explores the growing importance of Indonesian nickel in powering Europe's electric vehicles, and the complex, often hidden risks embedded in that supply chain. Key figures on Indonesian nickel production: 🟪 In 2023, Indonesia produced 1.8 million tons of nickel, accounting for 50% of global output 🟪 329 mining companies operate across 836,000 hectares 🟪MHP (Mixed Hydroxide Precipitate) production for batteries is projected to reach 294,000 tons in 2024 Despite claims from many automakers that they do not directly source nickel from Indonesia, the report finds that indirect sourcing is common through a network of refiners, traders, and battery suppliers. ⚠️ However, the upstream and midstream stages of this supply chain come with high ESG risks, including: 🟪 Land use conflicts and displacement of local communities 🟪 Deforestation and water pollution 🟪 Labor rights violations and unsafe working conditions The report urges German automakers, and OEMs more broadly, to take greater responsibility: 🟪 Assess and prevent environmental and social risks in their nickel supply chains 🟪 Ensure sourcing avoids ecologically sensitive areas 🟪 Enforce labor rights protections and safety standards 🟪 Improve transparency by publishing human rights and environmental risk assessments 📜 Compliance with due diligence laws like Germany’s SCDDA, the EU CSDDD, and BATT2 regulation will be essential to align operations with both legal and ethical expectations. ✅ Some companies are beginning to take action. Notably, Tesla's NEST (Nickel Efforts for Sustainable Transition) initiative — launched in 2024 in Morowali, Sulawesi — invests in biodiversity conservation, reforestation, and community development to address the impacts of nickel extraction. Sustainability starts at the source. If we want the EV transition to be truly green, then transparent, responsible, and locally engaged supply chains must become the standard. #EVs #Nickel #Sustainability #SupplyChain #Indonesia #Germany #China #ResponsibleSourcing #HumanRights #EnvironmentalImpact #DueDiligence #BatteryMaterials #JustTransition #ESG #Mobility