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This year’s falls in iron ore prices are likely to have been a dress rehearsal for what's ahead. Our China team’s forecast for the property sector to halve by the end of the decade does not bode well for iron ore producers’ plans to ramp up production. …
16th April 2024
We think that any impact from the suspension of trading of Russian metal on the LME and CME is likely to be muted, given that trade flows have already shifted markedly and it is unlikely to impact supply. The US and UK announced fresh sanctions on Russia …
15th April 2024
We think the price of gold will ease back from current record highs by end-2024, but falling US Treasury yields and some softness in the US dollar will keep the price elevated. Similarly, we expect the silver price to fall, but it will outperform gold. We …
12th April 2024
In light of our China team’s new non-consensus view that an aggressive slowdown in property sector construction seems almost inevitable in the years ahead, we have revised our price forecasts. We now expect prices to generally flatline in 2025, before …
10th April 2024
US steelmakers are preparing for robust growth in steel demand over the next few years, however we think those expectations will fall flat. Steel demand from property construction is likely to fall further and we expect softer demand for consumer durables …
5th April 2024
Production records a bright start to 2024 The robust increase in global steel production since the beginning of the year probably has a bit further to run since there are few signs that the two largest producers – China and India – will slow their supply …
22nd March 2024
China to drive output growth in coming months The drop in global aluminium production in February should be a blip now that output curbs in China’s Yunnan province due to power constraints have been lifted. According to the International Aluminium …
20th March 2024
China’s government is planning further fiscal loosening and hinting at rate cuts this year, with the aim of boosting economic activity. We think the policy backdrop is sufficient to support commodities demand this year, although for metals used in …
6th March 2024
We think that the gold price will rise in each of the next couple of years, driven by the Fed cutting rates a little quicker than is priced into markets, falling US Treasury yields and a softening US dollar. The gold price has taken a small leg-down since …
1st March 2024
Given the signs that cyclical and structural forces will raise tin demand this year, set against a backdrop of tightening supply due to the mining ban in Myanmar, we forecast the tin price to rise in 2024. The tin price has, for the most part, been …
28th February 2024
Output falls slightly but doesn’t signal a downward trend The year-on-year contraction in global steel production in January masks a sizeable monthly increase in output in China and India. Production in both countries should grow further over the next few …
23rd February 2024
Carbon price not out of the woods yet …
22nd February 2024
Production growth to remain subdued in 2024 Global aluminium production was unchanged in January compared to December. This reinforces our view that production growth will soften this year. According to the International Aluminium Institute, global …
20th February 2024
Higher aluminium prices and lower production costs should incentivise Europe’s smelters to restart some production in both 2024 and 2025. The introduction of CBAM in 2026 means prices will then probably trade at a premium to other regions, particularly as …
15th February 2024
We think the huge expansion in nickel supply will keep the market balance in a sizeable surplus this year. Accordingly, we don’t think the price will muster a recovery from its recent slump. The nickel price has been under consistent downward pressure …
12th February 2024
China's PMI surveys showed some signs of strengthening in January. But we still think they understate the strength of metals demand, which we expect to hold up fairly well this year. The latest China PMI surveys continue to tell slightly different …
1st February 2024
Output stagnant last year, more of the same in 2024 Global steel production reportedly stagnated last year. We think it probably will again in 2024 as a drop in production in China should offset increasing output by most other producers. According to the …
25th January 2024
Compared to their pre-pandemic averages, metals prices are high even after adjusting for inflation. We think that as green transition-related demand increases and monetary easing gets underway, real metal prices have further to rise in the coming years. …
Production growth will probably soften further in 2024 Global aluminium production growth slowed to 2.3% in 2023 from 2.9% in 2022. We think softening output growth in China will cause global growth to fall back again this year. According to the …
22nd January 2024
After a subdued 2023, we think the copper price will fare much better this year. We expect supply growth to moderate, while demand growth will be bolstered by the green transition. The copper price ended 2023 almost flat on the year. Consumption growth, …
19th January 2024
China PMI surveys suggest that the economy lost momentum in December, but we suspect that the surveys are not reflecting economic reality. Activity and import data all point to resilient commodity demand. Either way, the construction PMI rose again last …
2nd January 2024
Another monthly fall in China, but the US and India to remain at full blast The monthly falls in China’s steel production continued in November, but output over the year is almost certain to be higher than in 2022. Production in India grew quickly and …
21st December 2023
More subdued production growth likely over the coming months After hitting a new record in October, global aluminium production slipped back in November. We suspect that the new record will not be toppled in the coming months owing to power rationing in …
20th December 2023
China’s commodity imports mostly rose in November, but there was a sharp drop in crude oil imports. We think that non-oil commodity import volumes will hold up in the coming months on the back of looser fiscal policy, but current high stocks could …
7th December 2023
Even though zinc supply growth is likely to remain solid owing to strong growth in China and easing input cost constraints in Europe, we think that those factors will be outstripped by a recovery in demand. As such, our forecast is for the zinc price to …
China PMI surveys suggest that the economy flatlined in November, but there was good news for commodity demand with the relative strength in the construction PMI. We suspect that underlying activity is stronger than the PMIs and that this will support …
1st December 2023
In this Global Economics Update , we describe eight of the biggest risks to our economic forecasts for 2024. The unusual nature of this cycle and uncertainties surrounding the transmission of monetary policy mean that the biggest risks relate to central …
30th November 2023
Protests against a large copper mine have raged in Panama over the past few weeks. If mine production ceased, there would be noticeable impact on global supply but the risk of this happening is small. The mine is a key part of Panama’s economy and is only …
9th November 2023
We have raised our gold price forecast to reflect the current heightened geopolitical risk. We think the price will rise further next year as the limited fallout from the conflict won’t prevent the US Fed from starting to cut interest rates in 2024. Our …
The PMI surveys released so far for China weakened in October with the manufacturing PMIs falling back into contractionary territory. We think China’s demand for commodities will be supported by further fiscal stimulus over the next few months, but a …
1st November 2023
Cobalt is likely to keep its position as a leading battery metal for years to come, but its high cost compared to alternative metals means that cobalt demand won’t grow as fast as overall battery production. This is a key reason why we think that the …
13th October 2023
The trend of rapid increases in industrial metals supply this year is likely to unwind over the next few years for copper, but we think nickel supply growth will remain robust. We think that divergence will be a key reason why the price of copper will …
5th October 2023
The sell-off in bond markets has taken a breather today, helped in part by softer data on the US labour market. However, the scale of the moves over the past week has invoked comparisons to previous financial crises that have been caused by sharp moves in …
4th October 2023
Our in-house metals demand proxies show that growth was subdued in mid-2023. There could be some pick-up in the coming months owing to additional Chinese infrastructure spending, but we think a more sustainable revival in global demand will only emerge in …
29th September 2023
Based on our view that US economic growth will prove resilient, despite the rise in interest rates, and that US inflation will ease, we expect the gold price to fall to $1,800 per ounce by year-end. Since rising to around $2,000 per ounce on safe-haven …
15th September 2023
We think the recent rally in the iron ore price will soon go into reverse. Steel demand in China has surged in recent months, but we think that will prove temporary. China’s steelmakers should cut back on production once the boost to demand from a pick-up …
14th September 2023
We think that the silver price will fall over the next few months. But as macroeconomic and financial factors switch from a drag to a boost to demand, and as photovoltaic demand gathers pace, the price should recover in 2024. While the silver price has …
31st August 2023
The outlook for industrial metals demand has deteriorated alongside the weakening of China’s economy this year, particularly in the property sector. Monetary and fiscal stimulus might paper over the cracks, but we doubt it will be enough to do much more …
16th August 2023
Given the dominance of coal in China’s energy mix, a medium-sized electric vehicle (EV) produced there currently starts life with a “carbon debt” almost twice that of an equivalent internal combustion engine (ICE) vehicle. However, the greater efficiency …
15th August 2023
The widely-differing impact of El Niño across continents means that the net effect on global mining output is not clear cut. On balance, though, the likelihood is that it will lead to lower ore output, particularly of copper, and that it will be a factor …
18th July 2023
Not so long ago, a higher 10-year TIPS yield almost invariably meant an underperformance of US “growth” stocks vis-à-vis their “value” peers, a lower gold price, and a stronger dollar. That’s changed in 2023, though, with the relationships weakening …
13th July 2023
Expectations of fiscal stimulus in China have thrown previously floundering copper prices a lifeline. If policymakers go ahead, that may keep a floor under prices before a turnaround in construction in China and accelerating electric vehicle rollouts …
5th July 2023
We recently held a Drop-in titled “Industry’s decarbonisation challenge – From aviation to property”, which you can view on-demand here . This Update addresses some of the questions we received during the event, including those that we did not have time …
3rd July 2023
We think that the lead price will struggle over the next few months as high interest rates weigh on new vehicle (and lead-acid battery) demand growth and new supply comes online in Australia and Germany. Heading into 2024, we think that the shift to …
19th June 2023
Growth in China’s commodity imports generally was strong in May, with a notable rise in crude oil imports. While the data are consistent with our above-consensus outlook for China’s growth this year, a note of caution needs to be applied. Export demand …
7th June 2023
Lower steel production in April a sign of things to come Steel mills reduced output in April in y/y terms, meaning that global production is down year-to-date. We think that producers will continue to limit output for a few more months due to tepid …
23rd May 2023
Our in-house metals demand proxies show that growth held steady in February. While growth will accelerate in the coming months due to base effects, we think that underlying demand is more subdued. The CE Demand Proxies aim to measure physical demand for …
18th May 2023
Concern about banks and the US debt ceiling will keep the gold price historically high in the next few months. However, once these worries fade, we think that longer-term headwinds will come into play. At around $2,010 per ounce today, the gold price …
5th May 2023
The key message from the latest China PMIs is that whilst China’s economy is likely to grow strongly this quarter, momentum is fading. This will be one factor weighing on commodity prices in the near term. China’s Caixin manufacturing PMI fell from 50.0 …
4th May 2023
Our in-house demand proxies for industrial metals picked up at the start of 2023, which is consistent with China re-opening and resilient macroeconomic data in most advanced economies. What’s more, we suspect that growth will have accelerated in …
19th April 2023
