| Welcome to our guide to the energy and commodities powering the global economy. Today, reporter Annie Lee writes about the dark side of Indonesia’s nickel industry. To get this newsletter sent straight to your inbox, sign up here. Indonesia has transformed global nickel supply during the past decade, attracting billions of dollars in Chinese investment. But the battery-metal boom that’s created fortunes and tens of thousands of jobs is also raising increasingly uncomfortable questions around the price of this success. Our reporting in the past year at a sprawling complex of factories, smelters and coal-fired power plants on the island of Sulawesi — where companies have direct relationships with some of the world’s largest battery manufacturers — found many of the trappings of development. But we also found a record of fatal accidents and ecological damage. On Christmas Eve last year, an accident at the vast Indonesia Morowali Industrial Park, controlled by China’s Tsingshan Group, left 21 people dead. (IMIP says safety is a priority, adding that it “quickly required all enterprises to carry out safety risk screening and rectification” after the accident.) Chinese and Indonesian workers we spoke to detailed this and other incidents. Just last week, in the same spot as the December accident, two workers were scalded by hot steam during a cleaning operation.  Aerial view of Indonesia Morowali Industrial Park, Sulawesi. Photographer: Muhammad Fadli The risks around Indonesia’s nickel are not lost on miners, battery producers and carmakers, all of whom want to sell into global markets and not just China. At an industry conference in Jakarta last week, environmental, social and governance questions were repeatedly debated — while a handful of protesters gathered outside, a rare occurrence. What’s less clear is how those words translate into action. Certainly, the world needs Sulawesi’s metal. In its most recent impact report, Tesla Inc. points out that the transition to electric vehicles “will not be possible by only relying on non-Indonesian nickel.” Quite so: Indonesia accounts for roughly half of global production and is squeezing out pricier competitors. According to forecasts from investment bank Macquarie Group Ltd., by the end of this year it will account for nearly two-thirds of the global processed output. The auto industry wants to keep prices down, and that means cheap metal. It’s also true that even as a new president prepares to take office, no high-profile policymaker is seriously suggesting reversal of a policy that has brought income and work to Indonesia’s distant reaches. But that doesn’t mean that pressing on as before is the only option. To retain dominance, those who have made fortunes with Sulawesi’s smelters could do worse than to begin to tackle a problem that isn’t improving on its own — or risk a bifurcation of clean and tainted metal |