For the last two years, most of the investor world was focused on AI, tech, or the megatrends making headlines. But behind the scenes, a far more fundamental shift began gathering steam — in commodities, especially metals and mining.
According to Bank of America’s 2026 forecast, commodities are the single most attractive “run-it-hot” trade next year.
Vanguard Commodity Strategy Fund Admiral Shares
That means the next major bull run may not come from flashy new tech or hype — but from raw materials: copper, aluminum, lithium, battery metals, base metals, and rare earths.
Simple inputs powering electric grids, data centers, AI infrastructure, renewable energy, infrastructure rebuilds, and defense.
Why Metals & Mining Are Poised for a Big Breakout
• Macro tailwinds — inflation, fiscal stimulus, and commodity demand
BofA argues 2026 will be defined by “growth at all costs”: fiscal stimulus, rising capex spending, and infrastructure spending. Commodities often benefit disproportionately in such environments.
With interest rates likely to stay lower, bond yields less attractive, and inflation still a concern — metals become a natural hedge and real asset play.
• Supply-demand imbalance in critical metals — driven by energy transition & AI/data-center buildout
Global demand for metals tied to electrification, renewables, battery storage, electric vehicles (EV), and data-center expansion continues to surge. Recent reports show that energy-transition metals — copper, lithium, nickel, cobalt, graphite, aluminum — face serious supply constraints even as demand ramps up.
With existing mines aging, ore grades falling, and few new mines coming online quickly, supply is struggling to keep up. That’s a recipe for rising prices.
• Base metals — especially copper and aluminum — are positioned to outperform
Analyst banks such as Morgan Stanley have explicitly called out copper and aluminum as base metals with strong upside entering 2026.
Copper, already benefiting from electrification and infrastructure demand, may see further gains if supply tightens or demand from data centers, renewables, and EVs surges.
• The “real-asset reset”: investors rotating from bonds/stocks to physical assets
With low yields, political and inflation uncertainty, and decades of undervaluation, metals are becoming a preferred ballast for portfolios — diversifiers that also benefit from real global demand. BofA calls this the classic “run-it-hot” trade.
• Long-term structural demand — not just a cyclical uptick
This isn’t just about a one-year bounce. The world is undergoing a massive energy transition, grid modernization, data–center & AI infrastructure buildout, EV adoption, and global reindustrialization. All of these trends require metals — and lots of them.
Even if economic growth slows or cycles disrupt, demand for metals is unlikely to disappear. In fact, long-term demand now looks more structural than ever.
What This Means for Investors in 2026
If you’re positioning for 2026 — it’s no longer enough to look only at growth sectors like tech or biotech.
Metals & mining offer a rare blend of macro tailwinds, structural demand, and real-asset value.
Expect base-metal names (particularly copper & aluminum) to lead the charge — with upside not only from price but from share-price leverage.
Look for battery metals, critical-mineral miners, and diversified miners to benefit from supply constraints and global demand for renewables and infrastructure.
Commodities exposure may serve as portfolio ballast — helping hedge equity and rate risk while delivering real upside if demand accelerates.
Over the next few days, we’ll drill into specific sub-sectors (copper, battery metals, critical minerals) and highlight top mining equities I believe will outperform as this cycle unfolds.
Here’s to your future,
Matt McCall
Founder, NXT Wave Research
