Inwestowanie.com — Deutsche Bank (ETR:) The study in the note presented forecasts for mining resources through 2025, pointing to a complicated interaction of global economic uncertainty, geopolitical factors and structural industry reforms.

The note covers key topics that may impact market dynamics, with particular emphasis on tariffs, capacity controls in China, consolidation through mergers and broader corporate restructuring.

Together, these factors set the stage for a key year for commodities and mining stocks.

The backdrop to this development is significant challenges in 2024, including faint global demand for metals and the impact of geopolitical tensions.

However, the forecasts are cautious and confident, and signs of recovery can be expected in the second half of 2025.

Much of that recovery will depend on the trajectory of global trade policy and the stabilization of key markets, analysts said.

Deutsche Bank’s central case predicts metals prices will fluctuate in early 2025, followed by a rebound as demand improves outside China and easing economic pressures.

The note focuses on five main themes, each of which is expected to have a profound impact on commodity markets and mining stocks.

The impact of US tariffs

The return of aggressive trade policy under Trump could change the shape of global markets.

The imposition of tariffs, especially on Chinese metals, is expected to provide a bailout for U.S.-based steelmakers while hampering the development of copper, a commodity highly sensitive to global trade and economic growth.

Deutsche Bank’s forecasts suggest that an internationally cooperative approach such as moderate tariffs combined with stronger trade diplomacy could drive up metal prices, including metal that is currently undervalued relative to demand fundamentals.

Ceasefire between Russia and Ukraine

A potential ceasefire between Russia and Ukraine is seen as a key event that could stabilize energy markets and boost global risk appetite.

For the mining sector, rebuilding Ukraine’s infrastructure could boost demand for steel and other key materials.

However, the resolution could also lead to the normalization of prices for energy-intensive metals such as aluminum, where Russian production plays a major role in global supply chains.

European steel producers stand to benefit significantly from reduced energy costs and renewed demand for reconstruction projects.

Production capacity control in China

China’s metals production policy remains a cornerstone of the global mining narrative.

Measures such as aluminum capacity cuts and the elimination of export tax credits aim to address oversupply, boost domestic margins and improve international trade relations.

These changes could tighten global supply, creating an advantage for companies like Norsk Hydro (OTC:) that are well positioned to benefit from these changes.

Similarly, reforms in China’s steel sector to reduce overcapacity and reduce export surpluses could ease global price pressures and strengthen margins for Western producers.

Consolidation through M&A

The note points to a resurgence in M&A activity driven by key players’ strategic shifts toward copper and other green metals imperative to the energy transition.

In the face of underinvestment in greenfield mining projects and growing demand for these raw materials, consolidation is seen as a necessary response to structural challenges.

Companies such as Anglo American (JO:)), Teck and First Quantum (NASDAQ:) have been identified as potential acquisition targets, reflecting a broader industry trend towards streamlining portfolios and increasing operational efficiency.

Enterprise restructuring and listings on US stock exchanges

Wanting to unlock value, several European mining companies are restructuring their companies and examining listings on American stock exchanges.

Companies like Glencore (OTC:), ArcelorMittal (NYSE:), and Acerinox (BME:) are reassessing their structures to benefit from more favorable valuation conditions on US markets.

These moves are expected to realign their businesses, simplify their portfolios and potentially boost returns for shareholders.

Deutsche Bank remains confident that commodity prices will rebound in the second half of 2025.

Aluminum is positioned as a standout, benefiting from tight Chinese production and rising demand.

Despite short-term risks related to global trade uncertainty, copper is projected to enter a structural deficit by the end of 2025, supporting higher prices.

On the other hand, the outlook for iron ore is less favorable, with the market likely to see continued surpluses due to falling demand in China and rising global supply.

Among the top picks, Anglo American is praised for its strategic simplification efforts and exposure to high-margin copper assets.

Norsk Hydro may benefit from failing aluminum supply dynamics, while Rio Tinto (NYSE:) remains the preferred iron ore name, offering defensive properties amid market volatility.

Glencore, with its mighty cash flow and potential for a U.S. stock exchange listing, is another standout recommendation.