December 12, 2025
Jonathan Brandt, CFA, is a Senior Equity Research Analyst at HSBC. He is head of HSBC’s LatAm cement, construction and real estate equity research team and also covers the LatAm pulp and paper sector.
He joined HSBC in February 2010 as a LatAm metals and mining analyst, before transitioning to the pulp and paper sector in March 2013.
Previously, Mr. Brandt was a buy-side analyst for six years at a major U.S. investment firm, covering commodity companies in LatAm and EMEA.
He holds a bachelor’s degree in economics from Wesleyan University and is a CFA charterholder.
Mr. Brandt has a definitive outlook for copper prices over the next 2 to 3 years.
“Copper has been in focus for a while.
The attention, ebbs and flows over time, but there’s a structural deficit story to be told for copper.
Demand should continue to be strong, led by renewable energy, green investments, EVs, an so forth.
To a large extent, that’s offsetting whatever weakness we’ve seen in the more traditional uses of copper, such as the impact on trade and manufacturing, slower economic growth, higher interest rates…
And then more, if you combine that with supply issues.
So that’s really been the driver over the past several months.
Also, Freeport (NYSE:FCX) had an accident at their Grasberg operations.
And we saw negative revisions to a few mines in Latin America.
Codelco had an accident at one of their mines.
So that has led to a pretty sharp downturn in supply growth expectations for 2025 and into 2026.
And so, we’re looking at a deficit market for at least 2025 and 2026, but then potentially into 2027.
And then we just don’t have the supply growth coming in copper like we have in other commodities.
So, it’s certainly possible that we’re looking at a structural deficit.
Now that’s been discussed at length for the past five to seven years, that we’re entering into a structural deficit.
It hasn’t necessarily materialized, but with some of the issues that we’re seeing on the supply side, as well as the continued demand growth, it’s definitely something that could be materializing here in the next year or two…
Copper is a second derivative of AI.
It’s used in power generation and electrical components of AI.
So, as AI is going to demand more and more energy, there should be a secondary positive impact on copper.
So by that, I mean, AI itself will use a little bit of copper.
But it’s really the power requirements of AI that will help spur demand for copper.”
James Steel is HSBC’s Chief Commodities Analyst with specific responsibilities for precious metals.
Mr. Steel joined HSBC in May 2006.
Previously he ran the New York research department of a large U.S. commodities brokerage house.
He also worked for The Economist in the Economist Intelligence Unit covering commodity producing nations.
Mr. Steel’s primary duties at HSBC include the production of daily market reports, including long-term outlooks for precious metals.
These include supply/demand and price forecasts, as well as qualitative analyses.
Mr. Steel studied economics in London and New York.
James Steel has a long term view on the price of gold and the mining stocks that will benefit.
“Over the long run, it’s inversely related to the dollar and it’s inversely related to the real yield on the U.S. 10-year.
Now, that relationship has broken down in the last few years.
But generally speaking, gold is inversely related to the real yield, be it negative or positive on medium term bonds and also on the dollar.
But you have to be careful because those relationships have taken a bit of a hit in the past couple of years…
I talk to all sorts of companies that are related to gold.
Without disclosing any clients specifically, HSBC is a massive physical bullion house.
We’re the biggest in the world.
So we have mining clients, we have recycling, fabrication, smelting, mints, central banks, hedge funds, jewelry makers, retailers.
So, we keep abreast and we service this entire range moving from it coming out of the ground to it being invested in and everything in between.
And so, yes, it’s one of the things that make being an analyst at HSBC a little simpler than in other companies because we have a massive huge physical client base that allows me to draw a lot of information.”
Volatility in the gold market is the theme for 2026 according to Mr. Steel.
“I think the market is going to be very volatile.
Very volatile.
We’ve had a lot of new entrants into the market and they’re certainly sophisticated investors, but they’re not necessarily experienced in gold.
So, this new money that’s come in — like we’ve seen it in the stock market and I’m sure you’ve seen it in many other areas that you cover — this is going to add to the volatility.
And any change in monetary policy, or any change in the geopolitical risk thermometer.
For example, say a settlement in Ukraine, and we’re not saying there will be one, we’re just using that as an example.
So, if the stock market correction continues to the point where we get a lot of liquidation in the gold market, or if we get a change in the House and the Senate in the midterms or elections abroad, all these things I think are likely to keep the market very volatile.
And that’s why we’re looking for spikes higher consistently in the first half of the year before we finally begin to moderate and settle down.
Because you can’t avoid the fact that the jewelry market and coins and small bars are being hit very, very heavily by this high price.
And most gold is bought in the emerging markets, not in Western markets.
And they’re very price sensitive.
And so, when the market does stop going up for any length of time, that could come to bear.
So, I’m looking for a very wide trading range next year.
It’s going to be a very exciting market.
Very exciting.”
Read the entire interview with Mr. James Steel and Mr. Jonathan Brandt of HSBC exclusively in the Wall Street Transcript.