The Strategist

Fitch downgrades global metal price forecasts

09/16/2022 - 11:18

In a recent analysis, the international rating firm Fitch Ratings reduced its prediction for metal prices for the current and next years.

Kreepin Deth
Kreepin Deth
Fitch projects spot nickel prices at the London Metal Exchange (LME) this year at $24k per ton rather than $25k, $20k per ton in 2023, and $17k in 2024. The downgrade, according to Fitch, indicates declining demand from the stainless steel industry.

The agency reduced its projections for zinc prices in the following years, from $3.6k per ton for the present year to $3.4k and from $3k to $2.8k for 2023. The agency has maintained its 2024 prediction of $2,5k. The revised forecast take into account pressures from the recession and higher prices, as well as demand-decreasing energy difficulties.

At the end of this year, the spot price of aluminum is anticipated to be $2k per ton. Aluminum is anticipated to rise from $2k to $2k in 2023. Forecast for 2024 remained at 2,5k. A decrease in the demand for this kind of raw material, particularly as a result of the fragility of the Chinese building sector, is what accounts for the lowering of aluminum price projections for 2022–2023.

In 2022, copper will cost $8.7k per ton on the LME rather than the previously anticipated $9.5k. The $8,5k forecast for 2023 was changed to $8k. The short-term revisions take into account the global economic slowdown and projections of weaker demand, which are anticipated to result in a modest surplus in 2023, according to Fitch.

The price of gold is still expected to reach $1.8k per troy ounce in 2022, $1.6k in 2023, and $1.4k in 2024, according to Fitch. Forecasts for gold prices have been consistent because the commodity serves as a "safe haven" in times of extreme geopolitical unpredictability and inflationary pressure.