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Commodities Superycle?

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Question asked 24/05/2025

Commodities Superycle?

There has been a lot of talk about a commodities super cycle for some years now but, aside from gold, it seems that it's still some way off. Or am I just too early? Commodities/materials such as silver, copper, platinum, palladium and uranium (perhaps the latter might be a recent exception) are still not showing signs of any out-performance, despite constantly being talked up by analysts and brokers. What are your thoughts please? Many thanks as always.

Answer

Hi David,

We feel its more a case of evaluating each commodity on a case by case basis, basically as you alluded to. The overall industrial’s metals index has gone nowhere over the last few years which is pretty aligned with Chinas lacklustre economy which has delivered a few false dawns but never managed to kick back into gear as its Real Estate weakness weighs on growth.

MM believes investors should focus on individual commodities as opposed to focusing on a “commodities super cycle” per se, which will likely need India and Chinas economies to fire in unison.

As we often say “listen to the tape” but we do have an opinion on a couple of commodities at this stage which again align with your question:

We believe gold has indeed started a bullish Supercycle.
We also believe that copper and uranium are in the early throws of at least structural bull markets, predicated on the gap forming between likely demand and current supply projections.

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Bloomberg Industrial Metals Index

LAST UPDATED 23/05/2025 10:56

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