Defying the Cost Chaos: Strong execution shields mining margins from input shocks

Research evidence excerpt

Defying the Cost Chaos: Strong execution shields mining margins from input shocks

Idea

July 30, 2026 03:00 AM GMT

Morgan Stanley & Co. International plc+MEuropean Metals & Mining Tracker | Europe Alain Gabriel, CFA

Equity Analyst

Defying the Cost Chaos Alain.Gabriel@MorganStanley.comAdahna Ekoku +44 20 7425-8959

Adahna.Ekoku@morganstanley.com +44 20 7425-0578

Strong execution shields mining margins from input shocks Ferdinand Huber

Research Associate

Exhibit 1: 1H26 Copper unit costs remained broadly flat YoY - on average - for Ferdinand.Huber@morganstanley.com +44 20 7677-2702

copper mines, while inflation was limited at ~5% for bulks in spite of the sharp RMB Morgan Stanley Proprietary Limited+

volatility in input costs Brian Morgan

400 c/lb) 180 Brian.Morgan3@rmbmorganstanley.com +27 11 587-0803

Bulks: +5% (US$/t) 158 350 (US ~ Copper:avg YoY, ex-RIOflat avg YoY

cost cost Morgan Stanley & Co. International plc+

300 unit unit 135 Amy Gower (Amy Sergeant), CFA

113 Commodities Strategist 250 Copper Bulk

200 90 Amy.Gower1@morganstanley.com +44 20 7677-6937

150 68 Ben Kelson

100 45

Ben.Kelson@morganstanley.com +44 20 7677-1392

50 23

0 0 Mining 101

(50) (23) Mining & Steel Equities

Glencore – Glencore – Rio Tinto – Antofagasta First Freeport – Glencore – Glencore – BHP – Met Rio Tinto – Fortescue – Whitehaven

Copper Copper S. Copper – Copper Quantum – Copper Energy Coal Met Coal Coal (BMA) Iron Ore Iron Ore – Coal Mining Sector Valuation Long Term

Africa America Copper

1H CY25 (c/lb) 1H CY26 (c/lb) 1H CY25 (US$/t) 1H CY26 (US$/t) Steel Sector Valuation Long Term

Source: Morgan Stanley Research, Company Data. Copper average decline excludes Rio Tinto given the exaggerated percentage Commodity Price Signals

change of low numbers.

Commodity Price Forecast