Fitch Ratings Raises Most Near-Term Metals and Mining Price Assumptions

(Fitch Ratings-London-04 December 2025)--Fitch Ratings has raised its 2025-2026 price assumptions for copper, iron ore and aluminium, reflecting healthy demand, as well as for Australian thermal coal, reflecting year-to-date prices and some supply-side adjustments. We have also raised our short- and medium-term assumptions for gold, platinum-group metals, zinc and cobalt, reflecting tight balances in most markets.

We have increased our 2025 assumptions for coking coal, Chinese thermal coal and lithium, and cut our assumption for nickel to reflect year-to-date prices.

The increased copper assumptions reflect a tightly balanced global copper market in the near term. Despite some slowdown in demand growth in 2026 to about 2%, from over 3.5% in 2024-2025, we expect the market to remain in a small deficit (similar to that in 2025) due to weaker-than-expected supply growth (about 2% in 2025-2026, according to Wood Mackenzie) caused by mine disruptions. We expect demand growth to remain at about 2% in 2027, while production growth is likely to accelerate, keeping the market tightly balanced.

The increased iron ore assumptions reflect year-to-date prices and a higher starting point for 2026. We expect demand to remain broadly flat over the next two years, while supply will expand by 50 million tonnes (mt)-75mt including the low-cost Simandou mine delivering about 20mt in 2026 and 45mt in 2027.

The revised 2025-2026 aluminium assumptions reflect year-to-date prices and an elevated starting point for 2026. A surge of imports into the US in 1H25 ahead of tariffs, anticipated Fed rate cuts and investment funds increasing long positions drove prices higher. While sizeable capacity expansions are under way in Indonesia, which should help to meet future demand, these may take longer to come online due to power-supply limitations.

The increased 2025-2028 zinc assumptions incorporate year-to-date prices and our expectations of future market deficits.

The higher gold assumptions for 2025 and 2026 reflect the 2025 price rally, with central banks buying sizeable volumes to diversify reserves, and institutional and retail investors increasing their gold allocations. We assume these positions may unwind in future, but recognise that macro drivers – falling interest rates, dollar depreciation and geopolitical tensions – are unlikely to abate in the near term.

Platinum-group metals will be in supply deficit in 2025, similar to 2023 and 2024. Prices have risen by more than 50% year to date, due to weather-related supply disruptions in South Africa, pre-emptive hedging ahead of US tariffs, opportunistic Chinese stockpiling and speculative trading in precious metals. Medium-term supply-demand fundamentals for platinum and rhodium will remain tight, while palladium is likely to shift into surplus.

We have increased our medium-term rhodium price assumptions, as it is not feasible to replace meaningful volumes with other catalytic converter materials. A higher share of light-duty vehicles with hybrid powertrains and slower phase-out of internal combustion engine vehicles will support elevated rhodium prices for several years.

The increased 2025 thermal coal assumptions reflect year-to-date prices, while the higher 2026 assumption for the Australian benchmark incorporates an elevated starting point for 2026 and some supply-side adjustments, particularly among higher-cost producers, which helps moderate price decline as demand stays soft.

The higher 2025-2027 cobalt prices reflect the introduction of export quotas by the Democratic Republic of the Congo (DRC), which accounts for about three quarters of global cobalt supply, which replaced an export ban in place for eight months until 15 October. The quotas set a monthly limit of 7,500 tonnes until end-2025 and an annual limit of 96,600 tonnes for 2026 and 2027, representing about half of 2024 production. Increasing output from Indonesia and growth from recycled materials only partly offsets the reduction from the DRC. (ends)