The metals market is catching a break, according to BMI Research. The British firm just laid out an outlook for 2026 that's cautiously optimistic, forecasting that most minerals and metals will average higher than they did in 2025. The reasoning? Tighter supply meets robust demand from sectors chasing net-zero goals, all while trade tensions finally start to ease.

In their report titled "Mining and Metals Key Themes For 2026: Global Economic Stability to Drive Gains," BMI makes the case that global economic stabilization and declining trade frictions will support commodity consumption. It's a scenario where the chaotic uncertainty that's plagued cross-border trade starts fading into the background, which turns out to matter quite a bit for this industry.

Tariff Headwinds Beginning to Ease

Here's the big shift BMI is banking on: tariff uncertainty peaked back in August 2025 and should continue declining through 2026, barring the occasional flare-up. That matters because when companies worry less about unexpected trade barriers, they're more willing to invest, plan their offtake agreements, and generally operate without constantly gaming out worst-case border scenarios.

There's one notable exception to watch. Copper carries some lingering tariff risk because the U.S. Secretary of Commerce has a deadline of June 30, 2026 to issue an update on the domestic copper market. That update will determine whether a progressive universal duty gets implemented starting in 2027. So while the overall trade picture is improving, the red metal still has a question mark hanging over it.

Meanwhile, BMI expects the merger and acquisition frenzy in the sector to keep rolling. The competition to lock down minerals critical to clean-energy supply chains is heating up, with miners and metals producers hunting for deals that boost their exposure to copper, lithium, rare earths, and other energy-transition materials. Companies are pairing these acquisitions with large-scale capital expenditure programs, though they're increasingly favoring phased developments and brownfield expansions as they navigate cost pressures and shifting regulations.

Where the Optimism Hits Its Limits

BMI isn't calling for an uninterrupted rally, though. The firm sees the U.S. dollar index stabilizing in the 95-100 range, which would cap upside potential for metals. Gold specifically is expected to stay elevated early in 2026 but fall below $4,000 per ounce later in the year as the momentum behind global monetary easing starts to fade.

Then there's China, which introduces a major constraint. BMI forecasts that Mainland China's real GDP growth will slow from 5% in 2025 to 4.5% in 2026. The ongoing weakness in the property market is set to remain a drag on industrial metals price growth, which is a problem when China represents such a massive portion of global demand.

That said, BMI notes that persistent policy support should provide some offset, helping to boost demand for copper, aluminum, lithium, and nickel even as the broader economy decelerates.

Price Watch: VanEck Gold Miners ETF (GDX) is up 124% year-to-date.