Fitch unveils new projections for metals prices

Fitch Ratings unveiled fresh projections for prices of key metals and mining products. 

The rating agency raised all assumptions for gold prices due to a higher geopolitical premium and medium-term and mid-cycle prices for coking coal on tight longer-term supply, while it also increased 2024 assumptions for copper and Australian thermal coal.

On the other hand, it reduced assumptions for platinum and palladium, reflecting prices so far this year. It also cut 2024-27 price forecasts for lithium and 2024-25 prices for cobalt due to slower electric vehicle (EV) uptake. However, the rating agency increased 2025-27 zinc price projections on higher medium-term demand.

For copper, Fitch sees the 2024 year-end price at US$8,800/t, up from US$8,600/t before. It kept year-end price forecasts for 2025, 2026 and 2027 at US$8,400/t, US$7,500/t and US$7,500/t, respectively.

"The increased 2024 copper assumptions reflect higher prices so far in 2024. Spot prices have been declining in September, after peaking at above US$10,000 a tonne in May, due to concerns about the Chinese and global economies, while supply disruptions have been limited this year," the rating agency said in a statement.

"China dominates the copper supply chain, accounting for 55% of global copper consumption and about half of global copper smelter capacity. Longer-term copper demand growth is driven by the energy transition, the pace and scale of which are highly uncertain. Copper consumption will depend on EV adoption rates and copper intensity per vehicle, which has been declining markedly," it added. 

For iron ore, the rating agency maintained the end-2024 price forecast at US$105/t, at U$90/t in 2025, US$85/t in 2026 and US$75/t in 2027.

"Our assumptions for iron ore, aluminium, rhodium, Qinhuangdao thermal coal and nickel are unchanged due to demand concerns, despite price volatility. Iron ore prices had been supported by demand from China in 2024 but greater Chinese steel production cuts from end-July have started affecting demand,” added the rating agency. 

CHINA

China is the main consumer of many commodities from Latin America and a driver of prices.

"We are expecting [growth of] the Chinese economy to ease this year compared with last year to a level of 4.8% [from 5.2% in 2023] as rapid export growth eases and also due to measures in property markets. For 2025, the GDP performance of China is also likely to be lower, with an expansion of around 4.5%," Shelly Shetty, managing director and the head of Asia and Americas sovereigns at Fitch Ratings, told BNamericas.

"The Chinese economic performance impacts trade [in Latin America]. Brazil has a direct exposure to China along with various commodities like copper, oil, soybeans," she added.