Secular Supply and Demand Forces Aligning to Support Industrial Commodities

Bridgewater

Andrew Foote, Karen Karniol-Tambour

Article

1 Pages

Bridgewater Associates examines how the global shift toward electric vehicles and renewable power could create a lasting demand tailwind for industrial metals while years of restrained producer investment limit supply growth. EV ownership costs fell 85% over the prior decade, strengthening adoption economics.

Key Takeaways

EV Metal Intensity Electric vehicles require 2 to 5 times as much conductive metal as internal combustion vehicles, creating a potentially meaningful new source of metals demand.
Climate Demand Upside: Current climate policies could increase demand for various industrial metals by 10% to 30% by 2050, with coordinated global action potentially pushing demand even higher.
Supply Investment Cycle: Bridgewater believes industrial commodities completed phase 5 of the commodity investment cycle in 2020, leaving near term supply growth constrained following years of reduced capital spending.
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