The "unanimous strategic choice" of global mining giants: copper!

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Bank of America Securities pointed out in its latest global large mining company research report that a clear industry trend is taking shape: global mining giants are collectively shifting towards copper assets.

After the 2025 earnings season, the Bank of America analyst team observed that from BHP, Rio Tinto to Glencore, almost all major mining companies are prioritizing copper strategically, with capital expenditures rising sharply and now restored to more than 50% of previous peak levels.

Bank of America remains strongly optimistic about copper prices, expecting them to reach $15,000/ton. The institution believes that it is currently in the seventh month of an earnings upgrade cycle, after three years of downgrades, not only copper and gold but coal, nickel, and zinc are also seeing upgrades. Investors should pay attention to allocation opportunities in this sector, as fund manager surveys indicate the sector is now overweight.

Strategic Shift to Copper: Industry Consensus Established

The Bank of America research team found after analyzing 2025 results that all major miners are seeking more copper growth opportunities.

BHP has become the most typical case—copper business now contributes more earnings than iron ore, becoming the group's largest profit source. BHP claims to have the highest EBITDA sensitivity among large diversified miners for each $1/lb rise in copper prices. Although BHP is already the world's largest copper producer, the company still plans to boost copper output to over 2 million tons/year by the mid-2030s through a mix of brownfield and greenfield projects.

Rio Tinto is also undergoing active transformation. Although iron ore remains an important product, the absolute EBITDA growth in copper and aluminium businesses has completely offset the decline in iron ore.

Glencore’s copper growth choices are even more prominent, demonstrating the strongest copper growth potential in the industry through brownfield and greenfield project combinations. The company is looking for partners for its projects, especially the large-scale El Pachon greenfield project in Argentina.

Capital Expenditures Rise Sharply: Growth Story Regains Favor

Bank of America data shows that capital expenditures by large miners have now returned to more than 50% of previous peak levels and continue to rise. This indicates companies have regained growth authorization and investors want to hear growth stories again.

However, project execution is "mixed," such as budget overruns on the Jansen project and technical issues with the QBII project. It is notable that Glencore is looking for partners for its projects, reflecting the company's prudent attitude towards lowering single project risk.

At the specific project level, BHP is advancing the Vicuña joint venture project with Lundin Mining, with the first phase expected to cost $7-8 billion and deliver about 300,000 tons/year copper equivalent output. South32 has a recent 20% growth option, mainly from the Hermosa polymetallic project in the US and the Sierra Gorda copper joint venture project in Chile.

Commodities: Copper Prices Strong, Gold and Silver Retrace

Bank of America maintains its bullish stance on copper, forecasting prices to reach $15,000/ton.

Bank of America points out inventory accumulation in the US but not elsewhere. Strategic reserves may mean apparent demand increases. For iron ore, prices continue to decline, and Bank of America believes around $90/ton is the cost support level. The market is watching the pricing dispute between BHP and China Mineral Resources Group (CMRG) for Jimblebar ore.

Gold and silver have retraced sharply from recent peaks, but they still imply substantial free cash flow for related companies. The Bank of America commodities research team is bullish on several cyclical commodities, predicting copper prices at $11,750/ton in 2026 and $13,688/ton in 2027.

Early Signals of Cycle Turning Point

Bank of America notes the classic "cycle end starts" signals are appearing: resource currencies are strengthening—first the South African rand, Chilean peso, Brazilian real, now the Australian and Canadian dollars. Oil prices have rebounded from a low, cost pressures have started though not severe. These signals remind investors to be aware of cost inflation risks, although current threats are not significant.

The Bank of America research team stresses that after three years of earnings downgrades, the industry has now entered a seven-month earnings upgrade cycle, not only for copper and gold but also coal, nickel, zinc, and other commodities. The core logic for sector stock performance is the combination of positioning improvement and the earnings upgrade cycle.

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