LONDON/HOUSTON/SINGAPORE, Jan 20 – Geopolitical shifts, a rewired energy transition and cautious investment strategies will define the metals and mining sector in 2026 according to Wood Mackenzie.

“2026 will be a year of navigating complexities,” said Peter Schmitz, Director, Global Copper Markets Research at Wood Mackenzie. “The fundamental shift from molecules to electrons continues to drive a metals-intensive era, but the pace of this evolution is being dictated by a new geopolitical reality and a disciplined approach to capital allocation despite emerging opportunities.”

According to Wood Mackenzie, three critical trends will shape the sector:

Two hemispheres drive global economic turbulence: The global trade landscape for critical minerals will be defined by two significant events: China’s 15th Five-Year Plan in the first half of the year and the US mid-term elections in the second half. Wood Mackenzie anticipates that China will indicate a shift from infrastructure-driven growth to initiatives focused on consumer development.

“China’s balancing act between stimulating consumption and managing deflation will be a defining factor for commodity demand,” Schmitz added. “The outcome will determine whether we see expanded consumer trade-in programmes or more cautious, resilience-focused policies.”

In the US, mid-term elections will likely complicate fiscal policy, while market volatility stemming from tariff policies and a pending China trade deal will add further layers of uncertainty through November this year.

Energy transition rewired despite policy headwinds: The energy transition has reached critical mass and continues independently of political cycles. However, Wood Mackenzie has revised its base case outlook from 2.5 to 2.6 degrees, reflecting a slower global pace of decarbonisation.

Despite this, renewable power remains central to energy security globally. Technology developments in 2026 are expected to reshape market expectations for battery materials, particularly as solid-state battery commercialisation nears. Additionally, AI applications, and their market and material use implications, will become clearer. There is the potential for a Jevons paradox to materialise, where increased efficiency leads to higher overall commodity demand.

Although copper stands out due to ongoing supply disruptions, Wood Mackenzie projects a persistent oversupply in other sub-sectors through 2026, which will likely keep most prices low. Gold and silver are expected to benefit from central bank purchases and safe-haven demand.

Investment caution persists amid capital discipline: Despite emerging opportunities, Wood Mackenzie expects mining companies will continue to exercise caution to avoid overshooting the market. This leads to a preference for returning capital and engaging in mergers and acquisitions (M&A) rather than pursuing organic growth through new projects. This cautious stance is further complicated by the competitive landscape, where Western miners increasingly face pressure from state-backed Chinese investments that operate with different risk profiles and longer-term horizons.

Wood Mackenzie also warns of risks from ‘demand destruction’ in sectors where supply cannot be quickly increased, potentially forcing manufacturers to adopt alternative materials.

“We are already seeing this dynamic in the competition between copper and aluminium,” said Schmitz. “When prices remain elevated and supply is constrained, the incentive for material substitution grows. Trade barriers further intensify this risk by limiting global consumption and delaying critical investment decisions.”

As resource-rich nations become increasingly selective in choosing development partners, the supply pipeline faces further delays. Wood Mackenzie expects a shift in the investment landscape, with smaller, more agile players taking the lead on new developments while larger majors focus on consolidating existing assets.

Wood Mackenzie has released its 2026 outlook on the key themes shaping the metals and mining sector. This analysis covers market dynamics across the board, and explores how global trends will impact specific commodities. You can download reports for the following topics here:

•  Base & precious metals: What’s on the cards in the year ahead for aluminium, copper, gold, lead, nickel and zinc? Where will the biggest opportunities and challenges lie for each?
•  Battery raw materials: Lithium prices rebounded strongly after reaching cyclical lows in mid-2025. As the rally extends into 2026, a critical question emerges: can this momentum be sustained? Plus, how is record defence spending reshaping the strategic importance of cobalt? How will China make use of its dominant position in rare earth supply during 2026? How will the graphite market resolve a complex paradox.
•  Bulk commodities: Steel trade flows enter a new phase. A mix of familiar challenges and emerging shifts for coal. And a phase of gradual yet significant transition for iron ore.
•  Steel alloys: 2026 will be a policy-driven reset for the steel alloy markets. Across bulk and noble alloy, markets are being shaped less by consumption and increasingly by government intervention.