Looking for the 2024 outlook reports? Visit spglobal.com/BigPicture >

Introduction

As the global economy began recovering from the pandemic in the second half of 2020, the metals and mining sector benefited from rebounding prices. Demand for most metals was driven upward by the release of pent-up consumer spending, new government stimulus efforts and an accelerating global energy transition.  Having emerged significantly leaner following the 2013-2016 downturn, the industry has roused itself to tackle new opportunities while looking to avoid a repetition of past excesses.

The Take

Global efforts to combat the COVID-19 pandemic hampered most aspects of the metals and mining industry in the first half of 2020. The sector's rapid rebound in the second half, and rising demand for most mining commodities, has created robust conditions for producers and explorers. We expect these conditions to persist into 2022, and in some cases beyond. While we anticipate that metals prices will slip somewhat in 2022 from their current highs, medium-term supply constraints are setting the stage for historically above-average prices through to 2025 – driven mostly by increasing demand for materials used in the accelerating global energy transition.

The supply constraints are expected to persist despite intensive exploration efforts, which we forecast to expand further in 2022. Exploration will continue to focus on regions that have largely mitigated the pandemic's impacts; however, few of the resulting discoveries will be developed in time to meet medium-term supply requirements. Faced with persistent if moderating demand, the industry is set up for a period of sustained growth.