Australian Mining: Commodity Review: Valuation Support Emerges Post-Correction; Time to Begin Adding Exposure Amid Cost Headwinds

Research evidence excerpt

Australian Mining: Commodity Review: Valuation Support Emerges Post-Correction; Time to Begin Adding Exposure Amid Cost Headwinds

J P M O R G A N Asia Pacific Equity Research

05 July 2026

Australian Mining

Commodity Review: Valuation Support Emerges Post-

Correction; Time to Begin Adding Exposure Amid Cost

Headwinds

Through the quarter, forward curves for copper have risen, while precious metals Australia

and thermal coal have fallen materially. Key takeaways: 1) Base Metals: Our

Head of Australia Metals & Mining

2026-28 copper price is now ~$6/lb (+6%), zinc rises ~8%, with aluminium down

~4% in 2026, 2) Gold is down around 12% to 4300/4500/oz in 2027/28, while our Lyndon Fagan AC

LT price moves to $4100/oz (-$100) and is now set to the 2.5yr curve average in (61-2) 9003-8648

lyndon.fagan@jpmorgan.com

real terms, and 3) Lithium / iron ore / uranium are unchanged in 2027/28 with J.P. Morgan Securities Australia Limited

this review, but thermal coal is down ~9% for 2026 with the latest MtM (met coal AC Jonathon Sharp

is broadly unchanged). As we head into reporting season for the miners, costs are (61 2) 9003-8312

at the forefront with inflation running hot, and new FY27 guidance at risk of jonathon.sharp@jpmorgan.com

disappointing across the sector. This is a negative headwind. However, looking J.P. Morgan Securities Australia Limited

further ahead, valuation support has emerged across the space, with the Branko Skocic AC

ASX300M&M index down ~8% in 2 weeks (ASX200 -1%). We expect sentiment (61-3) 9633-4069

to eventually move risk-on again as the ME conflict simmers and on this basis we branko.skocic@jpmorgan.com

J.P. Morgan Securities Australia Limited

are inclined to “buy the dip”. We upgrade FMG, BMN, LTR to Overweight after

Devwrat Vegad