Growing cadre of analysts pointing to imminent commodities supercycle

A succession of multi-billion-dollar earnings calls from some of the biggest names in the mining space this week and soaring metals prices have provided the latest evidence supporting the onset of a commodities ‘supercycle’.

The notion of an imminent long-term boom in commodities prices was popularised by Goldman Sachs last month, based on the investment banking giant’s view of the global economic recovery being predicated on a metals-intensive ‘green industrial revolution’.

Further analysts have added weight to Goldman’s conviction call in the last week after seeing prices for iron ore, copper and nickel reach multi-year highs, while the world’s top two miners – Rio Tinto and BHP – reported surging full-year profits for 2020, despite of the impacts of COVID-19.

Mark Lewis, the chief sustainability strategist at BNP Paribas Asset Management told the Guardian: “It feels like any market you look at, investors want to buy.

“[The next 30 years are] likely to bring a supercycle in investments in clean energy infrastructure, clean transportation and everything else that is required to make the green transition possible”, he said.

Growing optimism on demand for copper, used in myriad clean industries from wind turbines to electric vehicles, pushed the price to a nine-year high this week, while key battery metals nickel and cobalt are trading at 17-month and two-year peaks respectively.