Shenwan Hongyuan Group Co., Ltd. has released a research report indicating varied performance among key non-ferrous metal companies in the fourth quarter of 2025. The precious metals sector is currently valued near the lower end of its historical range, suggesting significant potential for continued recovery. Copper supply remains relatively inelastic, supporting a sustained rise in price levels, while the aluminum market is tightening, pointing to a prolonged upward price trend. Among minor metals, nickel prices are expected to climb, lithium prices to stabilize with an upward bias, and cobalt prices to remain strong. Post-interest rate cuts, valuation benchmarks for the non-ferrous sector are anticipated to rise, with recommendations favoring new energy manufacturing segments enjoying stable supply-demand dynamics. Key views from Shenwan Hongyuan are as follows:
2025Q4 Earnings Preview: The firm forecasts that companies including Zijin Mining Group, Shandong Gold Mining, Chifeng Jilong Gold Mining, Zhongjin Gold, Hunan Gold, Western Mining, Yunnan Aluminium, Huayou Cobalt, Tengyuan Cobalt, JL Mag Rare-Earth, and Baoshan Iron & Steel will report year-on-year profit growth exceeding 50% for Q4 2025. Firms such as Jincheng Tongda and CITIC Pacific Special Steel are projected to see growth between 20-50%, while China Molybdenum, Tianshan Aluminum, and Valin Steel are expected to report growth of 0-20%. Companies including Zhongfu Industrial, Guocheng Mining, Shengxin Lithium Energy, Ganfeng Lithium, HBIS Resources, and Shandong Iron & Steel are anticipated to return to profitability. On a quarter-on-quarter basis, firms including Xinjiang Joinworld, Sinomine Resource, Ganfeng Lithium, and Shandong Iron & Steel are forecast to see growth over 50%, while Shandong Gold Mining, Zhongjin Gold, Huayou Cobalt, and Tengyuan Cobalt may achieve 20-50% growth. Growth drivers include rising prices (for gold, copper, aluminum, cobalt, and lithium-related firms), increased output, and cost improvements.
Precious Metals: The Federal Reserve maintained the federal funds rate at 3.50%-3.75% in its January meeting, with Chair Powell noting reduced upside inflation risks and downside employment risks. The nomination of former Fed Governor Kevin Warsh as the next chair, pending Senate approval, introduced short-term volatility. However, long-term structural shifts in monetary credibility, expected U.S. fiscal deficit expansion post major legislative packages, and low Chinese gold reserves suggest ongoing central bank buying as a sustained trend. Lower real interest rates post-rate cuts are likely to attract inflows into gold ETFs. With sector valuations near historical lows, continued recovery potential exists. Recommended stocks include Shandong Gold Mining, Shandong Gold International Mining, Zhaojin Mining, Zhongjin Gold, Chifeng Jilong Gold Mining, Zhuye Group, and Shengda Resources.
Industrial Metals: Copper: Industry officials have proposed expanding state reserves to include copper concentrate. Near-term supply disruptions and tight non-U.S. inventories are expected to keep copper prices firm, supported by solid fundamentals such as grid investments and AI data center growth. With supply constraints, copper price levels are set to rise steadily. Recommended stocks include Zijin Mining Group, China Molybdenum, Tongling Nonferrous Metals, Jincheng Tongda, Western Mining, and HBIS Resources.
Aluminum: Domestic production caps are tightening supply-demand dynamics, supporting a long-term price uptrend. Recommended stocks include integrated producers such as Nanshan Aluminum, Tianshan Aluminum, China Hongqiao, Aluminum Corp. of China, and Xinjiang Joinworld, as well as flexible players like Yunnan Aluminium, Shenhuo Coal & Power, and Zhongfu Industrial.
Minor Metals: 1) Nickel: Indonesia, supplying over 60% of global nickel ore, plans to cut 2026 mining quotas, intensifying supply disruptions. With demand stabilizing, nickel prices are expected to rise. Recommended stocks: Huayou Cobalt and Lygend Resources. 2) Lithium: Strong energy storage demand and battery export surges are driving consumption. On the supply side, delayed resumption of domestic lepidolite projects and overseas disruptions are expected to shift the lithium market from surplus to tight balance in 2026, supporting steady price increases. Recommended stocks: Sinomine Resource, Yongxing Materials, Guocheng Mining, Dazhong Mining, Shengxin Lithium Energy, and Ganfeng Lithium. 3) Cobalt: Export controls in the Democratic Republic of Congo and low inventories are likely to sustain cobalt price strength. Recommended stocks: Huayou Cobalt, Tengyuan Cobalt, and Lygend Resources.
Risks include international geopolitical shifts, macroeconomic changes, weaker-than-expected downstream demand, and commodity price volatility.