JPMorgan has shared its outlook for metal markets, forecasting a challenging start to 2025 but a robust recovery later in the year. The bank anticipates that U.S. tariffs on Chinese goods could temporarily weigh on base metals early in the year. However, this downturn is expected to reverse as China ramps up economic stimulus efforts and market valuations improve.
According to the analysis, base metal prices could face pressure in the short term due to a weakened Chinese yuan and the uncertainty around tariffs. Despite this, the bank sees a promising opportunity for investors in the coming months. Greg Shearer, an analyst at JPMorgan, revised base metals price estimates downward but highlighted a potential rebound starting in the second quarter of 2025.
Key projections include copper prices climbing to $10,400 per metric ton by the end of 2025 and aluminum reaching $2,850 per metric ton. Zinc prices are expected to remain steady, while nickel might stay under pressure, settling around $16,000 per metric ton due to oversupply concerns.
For precious metals, JPMorgan foresees significant gains. Gold is projected to rise to $3,000 per ounce, and silver is expected to surge to $38 per ounce by late 2025 as market conditions stabilize. Platinum prices could also see a boost, reaching $1,200 per ounce due to supply challenges.
In the iron ore market, the outlook suggests improving fundamentals, with stronger Chinese steel production and declining inventories. Iron ore prices are forecast to reach $100 per ton in 2025, driven by seasonal factors and robust demand, before gradually easing to $80 per ton over the longer term.
Potential risks to these forecasts include the impact of U.S. tariff policies, the scale of Chinese economic stimulus, and additional supply from major producers like Vale and Onslow.
This forecast highlights a mixed but optimistic outlook for metals markets, with opportunities for recovery and growth in the coming years.
