Start with the supply that left. BHP ($BHP) suspended mining and processing across Western Australia Nickel from October 2024 — the Kwinana refinery, the Kalgoorlie smelter, and the Mt Keith and Leinster operations — and put the development of West Musgrave on ice, all under a care-and-maintenance program. That review BHP intends to revisit by February 2027. Around it the field thinned: IGO ($IGO) completed the sale of its Forrestania nickel operations to Medallion Metals in March 2026. The high-cost Australian tonnes didn't get cheaper. They got switched off.
That is the backdrop for a structural case, not a momentum trade. The price is unremarkable: LME three-month nickel sat around US$18,689/t on 5 June 2026, after an April move from roughly US$17,000 to above US$19,000. But the supply map is genuinely shifting. The INSG expects nickel's first deficit since 2021 in 2026 (32,000t), and Indonesia cut its RKAB mining quota to 270 million wmt, from 375 million in 2025 and below expected demand near 345 million.
When the world's marginal producer chooses to manage price by cutting quota, you don't bet on the price — you buy the tonnes that print money beneath it.
The cleanest expression we see is Centaurus Metals ($CTM) and its Jaguar project in the Carajás of northern Brazil. The 2024 feasibility study is the reason to look: forecast production averaging 18,700tpa of nickel over an initial 18-year open-pit life, a maiden reserve of 63Mt at 0.73% Ni for 459,200 tonnes of contained nickel, first-quartile C1 and AISC of US$2.30/lb and US$3.57/lb, and pre-production capex of US$371 million. The cost structure isn't an accident — Jaguar taps 100% renewable grid power feeding Vale ($VALE)'s nearby Onça Puma operation, at roughly US$0.035/kWh, via a costed 40km spur line.
The financing scaffolding is going up. In March 2026 Centaurus signed a binding offtake with Glencore ($GLEN) ($GLEN): 20,000 dry tonnes a year of concentrate — about a third of capacity, roughly 6,400t of contained nickel — to Glencore's Sudbury smelter for five years from 2029, LME-linked, with revenue estimated above US$450 million. BNDES issued a letter of intent for FINEM debt financing after Centaurus's September 2025 application. An A$20-million placement in August 2025 kept the project on a path to a final investment decision in the first half of 2026. In our view, that FID — targeted by September under the Glencore milestones — is the catalyst, and the first-quartile cost is what lets it stand up at today's price.
The grade option is Lunnon Metals ($LM8) on the Kambalda belt. Its Baker–Foster resource is small but rich: a combined 3.1 million tonnes at 3% nickel for 95,100 tonnes of contained metal. The Baker PFS is modest and high-grade: a probable reserve of 612,000 tonnes at 2.86% nickel for 17,500 contained tonnes, pre-production capital of about A$18.6 million, and post-tax free cash flow of A$145 million. Cost-curve honesty: Lunnon has tilted drilling toward gold, and a 17,500t reserve is a starter mine, not a Class-1 platform. We read it as cheap optionality on the belt that BHP just stepped back from — not yet a thesis on its own.
This is the long game: own the bottom of the curve, let Indonesia set the ceiling, and wait. Patience is the position.