JPMorgan Mining Daily: Iron Ore +0.3%, Spodumene 12% Spot Scenario, China Steel Channel Checks & More
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JPMorgan's mining daily reviews commodity market performance and miner valuations. Iron ore rose 0.3% to $91/t, while spodumene spot prices fell 12.4% to $1,485/t. China's steel output is running at an annualized 858 million tonnes, down 2% versus the prior ten days and flat year-over-year. With spot prices weakening, the mining sector is in an earnings downgrade cycle, though copper equities show resilience and implied copper prices sit below spot. Gold prices declined, leaving covered names broadly exposed to estimate cuts. Introducing implied commodity pricing analysis, JPMorgan finds that 23 of 25 stocks imply prices below spot, suggesting much of the weakness is already in share prices and helping identify valuation opportunities. Looking ahead, it expects iron ore at $99/t in 2026, maintains a long-term copper forecast of $6/lb, and sees Chinese policy tools potentially supporting domestic steel demand. Preferred names are BHP, RIO, CSC, PLS, GMD, NEM and LYC; IGO was downgraded to Neutral, while PDN and DYL were upgraded to Overweight.
Key exhibits
Exhibit 1
