Most metals come from an ore you can concentrate first — crush the rock, separate the valuable mineral, and only then apply heat to the small fraction that matters. Most of the world's nickel doesn't work that way. It sits dissolved inside the rock itself, with nothing to separate, so the whole tonnage has to be melted or dissolved to get it out.
You almost certainly handled nickel today without noticing it was there.
Every route runs through the same four stages. What separates them is stage two: whether the ore can be concentrated before the heat goes in, or whether it can't.
In sulphide ore, nickel forms a mineral of its own — so you can pick it out and throw the rest away. In laterite, it doesn't. There is no nickel grain to find, so the whole rock has to be processed.
Nickel is not mined as nickel. It arrives locked inside one of two rocks that formed in completely different ways, in completely different climates, and the choice between them decides every step that follows.
Tropical rain spends a million years dissolving magnesium-rich bedrock and leaving behind a soft, iron-stained layer. The nickel it carries is scattered atom by atom through iron and magnesium minerals — never crystallised into anything you could pick out.
Found deeper and in colder regions, sulphide ore contains discrete grains of nickel sulphide. Copper, cobalt, platinum and palladium usually ride along, and together they can be worth more than the nickel itself.
That difference sounds academic until you try to process it. A sulphide mine can throw away most of its rock before spending a single unit of energy on heat — the valuable grains float, the waste sinks. A laterite mine cannot, because there is no separate nickel grain to float. Whatever comes out of the ground goes into the furnace or the acid, nickel and worthless rock alike. Everything expensive about making nickel follows from that one fact.
Laterite is split further by depth. The upper layer, limonite, is low in nickel but rich in iron and usually carries cobalt as a second prize. The layer beneath, saprolite, is richer in nickel but has little else worth recovering. Limonite is generally dissolved in acid; saprolite is generally smelted. The rock chose the route before anyone reached the site.
The furnace needs something to pull oxygen away from nickel and iron oxides. Carbon does it, which is why laterite smelting burns fossil fuel both as heat and as a chemical ingredient.
The alternative to heat is chemistry: acid dissolves laterite outright. Made on site where possible, which keeps the process cleaner. See how sulphuric acid is produced.
Neutralises leftover acid after leaching and adjusts slag chemistry in the furnace. See how limestone and lime are made.
The real raw material of laterite smelting. An electric furnace can draw up to 40 MWh per tonne of nickel — more than a typical UK household uses in a decade (Nickel Institute, 2024).
Three routes, one question: how do you separate a metal from rock it was never separate from? Heat, acid, or — if the ore allows — bubbles.
Laterite offers two answers and sulphide offers a third. Each is a different trade: energy against residue, capital against reliability, speed against purity.
Most nickel never passes through a refinery at all. It leaves the furnace as an iron-nickel alloy and goes straight into stainless steel — pure metal is the exception, not the rule.
The industry sorts its output by what it can still be turned into. Anything pure enough to dissolve into battery chemicals is Class 1. Everything else is Class 2 — perfectly good for steel, useless for a battery.
Cathode, briquette or powder above 99.8% nickel. Pure enough to dissolve into battery chemicals or alloy into aerospace superalloys.
An iron-nickel alloy straight from the furnace. Never refined to pure metal because it never needs to be — stainless steel wants the iron anyway.
Mixed hydroxide precipitate, roughly 40% nickel and cobalt; mixed sulphide precipitate, around 50–55%. Half-finished products shipped onwards for refining.
What a battery factory actually buys. Crystallised from refined metal or from MHP and MSP, overwhelmingly in China.
The line between the two classes used to be a wall. It isn't any more: with battery demand climbing, producers revived an old trick of converting ferronickel and nickel pig iron into matte, which can be refined to Class 1. It costs energy to undo work already done, but it lets a stainless-steel supply chain sell into the battery market — a fair sign of how sharply demand has shifted.
Nickel statistics are softer than they look. Most current-year figures are estimates, authorities disagree on the totals, and the most-quoted number of all — the laterite share — usually turns out to describe something other than production.
On the reserves figure, the greater-than sign is the USGS's own. It publishes world nickel reserves as more than 140 million tonnes because one line of its own table — production outside the named countries — is itself unbounded. Identified resources are a separate and much larger number, above 350 million tonnes, of which the USGS puts 54% in laterite deposits and 35% in magmatic sulphide.
That resources split is worth pausing on, because it is routinely quoted as though it described production. It doesn't. How much nickel is made from each ore type is a genuinely uncertain figure: published estimates range from roughly 30% laterite in studies using 2010-era data, to 69% laterite for 2020, and no authority publishes a clean current split. What is not in doubt is the direction — Indonesian laterite output has grown roughly sixteen-fold since 2015 (IEA), so laterite's share of production today is higher than any of those figures.
The concentration is real, and it is recent: the top three producing countries held just over 50% of the market in 2015 and close to 80% by 2024 (IEA). But the country that mines the ore is not the country that turns it into battery chemicals, and that gap matters more than either figure alone.
Two asymmetries are worth naming, because both cut against the usual framing. The first is that Indonesia's dominance does not stop at the mine — it is also the world's largest refiner of nickel, at around 1.5 Mt in 2024 and still growing (IEA). China's grip is on the narrower chemical step that turns intermediates into battery-grade sulphate. The second is that laterite has an Indonesia and sulphide has nothing like one: the IEA places higher-grade sulphide ore in Australia, Canada, China and Russia, with Finland and a new Zambian mine adding more, and the largest single sulphide producer, Russia, accounts for only around 5% of world output. One ore type is concentrated in a single country; the other is scattered across a dozen.
The ore supplying most of the world's nickel is also the hardest to clean up — because melting or dissolving whole rock takes far more energy than concentrating a mineral first.
Nickel is central to electric vehicles and wind turbines, and it is an energy-hungry metal to make. Both laterite routes carry a real cost — but not the same one.
The furnace burns coal for heat and for chemistry, then draws enormous power on top. Most of it happens on a coal-heavy Indonesian grid, so the carbon follows the electricity.
Acid leaching emits comparatively little, especially where the acid is made on site. What it leaves is bulk — neutralised residue and gypsum needing permanent, engineered impoundment.
Neither problem has a clean fix waiting. Green hydrogen could replace the furnace's carbon, and laboratory work on hydrogen reduction of saprolite ore looks promising, but it is unlikely to reach the tropical regions where the smelters actually sit any time soon — which is why laterite smelters are considered among the harder industrial plants to decarbonise. Turning HPAL residue back into something useful, iron ore or aggregate, has been studied for years and is still defeated by the chemistry.
Mining leaves its own mark on top of that. Laterite sits at the surface in the tropics, so extraction means clearing land — and on islands with species found nowhere else, that risk is not abstract. Sulphide mines face the older hazard of acid mine drainage. Both are manageable with the practices the industry now expects of itself; neither disappears by being managed.
Recycling should be the release valve. Nickel is genuinely recyclable, and where scrap exists it does the job well. The catch is arithmetic — the metal is being consumed far faster than the products holding it wear out.
So fresh ore stays central, and the interesting question becomes where it comes from next. Pressure oxidative leaching of sulphide concentrates has one commercial installation and room to expand. Heap leaching of laterite, gentler than smelting or HPAL, has reached small-scale commercial operation in Brazil. And the seabed is estimated to hold some 4.5 billion tonnes of nickel in nodules and crusts (USGS, 2022 study) — a number large enough to reframe the entire supply question, and one that stays untouchable without an international regulatory framework that does not yet exist.