ECONOMIST: Global price outlook warns of 2026 falls as energy, metals, food markets face tariffs, weak demand

Since 2020, commodity markets have been drunk on adrenaline as pandemic-era disruptions, Trump tantrums, war and sanctions rocked supply and demand. In 2026 a general sobering-up may prevail.

Individual commodities will fall into one of three buckets. The first will include fuel and food, demand for which will remain subdued as American tariffs hurt GDP growth and China’s economic woes continue. Supply, by contrast, looks plentiful.

More natural gas is being produced than ever, with new projects being completed in America, Qatar and elsewhere, just as the warming climate makes harsh winters less likely. Bumper wheat, corn and soybean harvests in 2025 have boosted global stockpiles.

Most emblematic of this category is crude oil. Absent a fully enforced American blockade against Russian oil—which looks unlikely, because Donald Trump will want to keep fuel prices low ahead of midterm elections—the world will be swimming in petroleum, as Gulf countries continue to restore some of the output they cut in recent years.

The question, for depressed commodities, is whether they could become so cheap that bargain-hunting starts to rekindle demand. Gold dominates the second bucket, of commodities in high demand.

Appetite for the yellow metal has rocketed as political uncertainty, geopolitical crises, trade shocks and the prospect of lower interest rates in America fuel investors’ search for a safe haven. After surging past $US4000 ($6086) an ounce in 2025, its price may well exceed $US4500, buoyed by political surprises and high inflation in America, and by instability worldwide. Retail investors and central banks alike will continue to buy gold.

Silver, also in demand, will continue to shine.The fate of the third bucket, of industrial metals, will determine whether commodities, as an asset class, manage to hold steady or tilt into deflation.

That bucket is led by copper, a traditional barometer for global economic health. In July 2025 the red metal’s price hit record highs on America’s main commodity exchange after Mr Trump announced 50 per cent tariffs on copper imports.

It fell back when he said the tariffs applied only to copper products, not raw materials, before rising again, amid fears the duties could be expanded.

Copper will continue to be buffeted by volatile forces in 2026. Tariffs will hit the global economy. And uncertainty may boost the dollar, sapping the buying power of manufacturers paying for copper in other currencies.

But Fed cuts could achieve the opposite. Global sales of electric cars might accelerate fast enough to devour vastly more copper, used in batteries, wires and motors.

Supply could be disrupted and new projects delayed. And perhaps Chinese factories will bounce back. Investors will be hoping that copper can cure the hangover gripping commodities as the year goes by.