Feb 26 (Reuters) - The London Metal Exchange should classify its nickel contracts into "clean" and "dirty" contracts to give customers more choice, Australian iron ore magnate Andrew Forrest said on Monday.

The comment by Forrest, chairman and founder of Fortescue Metals Group, is part of a push by miners and Australian lawmakers to save the country's nickel industry after prices collapsed amid a jump in cheaper supplies from Indonesia.

Nickel, a key ingredient in electric vehicle batteries, is typically produced to higher environmental and regulatory standards in Australia than in Indonesia. That has Australian producers calling for a green premium.

"If you've got dirty nickel in your battery systems, then you want to know about that because you don't want to propagate that and you want the choice to buy clean nickel if you can. So the London Metal Exchange must differentiate between clean and dirty," Forrest told Australia's national press club.

The LME did not immediately respond to a request for comment.

Australia's nickel industry is shedding hundreds of jobs. Forrest's private investment arm, Wyloo Metals, said last month it would put its Western Australian nickel operations on care and maintenance at the end of May due to low prices. It bought those assets last year for $504 million. (Reporting by Melanie Burton; Editing by Edwina Gibbs)