First Read Daily Commodities Note: Iron Ore up; Copper, Aluminium, Lithium & Gold lower...

Research evidence excerpt

First Read Daily Commodities Note: Iron Ore up; Copper, Aluminium, Lithium & Gold lower...

constraint, mine supply lifted in 2025 and improved concentrate availability allowed

TC's to lift from very low levels, supporting smelter restarts and growth in refined zinc

output. However, the market was not in a material surplus and visible inventories remain

low. In 2026 China smelter output continued to lift & demand remains weak resulting in

a well supplied China market vs relatively tight ROW refined market. The concentrate

market has once again tightened and lower TCs/silver/sulphuric prices are likely to see

China smelter output fall, eroding elevated inventories. In our view material China zinc

imports are unlikely; but exports remains a potential risk/overhang if LME prices lift

materially vs current levels capping LME upside. Link to note. Source: UBS.

Rio Tinto - Copper growth: a quick look at Los Azules: RIO currently plans to

increase copper production from 883kt (consolidated) in 2025 to ~1Mt by 2030 mainly

through the ramp up of Oyu Tolgoi to ~500kt on 100% basis (2025 345kt) & the

recovery of Kennecott (+70kt to ~200kt), part offset by lower volumes from Escondida;

in our opinion, RIO does however lack meaningful copper growth optionality medium-

term 2030-35 (with Resolution, La Granja & Nuevo Cobre longer-dated and Winu small

Fig5). RIO looked to address this through the merger with Glencore (news) in 1Q26; in

our opinion, RIO may now be looking to build out its organic copper growth pipeline

(similar to BHP with Vicunia) to complement the organic growth in lithium, aluminium,

and iron ore (Simandou). We note RIO has already committed to invest >$4bn in its

lithium business in Argentina (Rincon, Fenix 1B, Sal de Vida). Link to note. Source: UBS.