Fitch Ratings raised its price forecast of gold, metals, and mining for 2021 and 2022 due to short-term supply-demand imbalances and higher longer-term demand.
The global rating agency now expects the price of gold to average $1,800 per ounce this year, up from its previous estimate of $1,700, and estimates it to average $1,600 an ounce next year, up from $1,500.
The upward revision reflects "increased demand due to its 'safe haven' investment status," the agency said in a statement on Tuesday.
The agency, however, noted that demand for gold has moderated since the height of the coronavirus pandemic "due to better prospects of economic recoveries."
The price forecast of aluminum was revised up to $2,450, from $2,200 per ton, for this year, and to $2,500, from $2,000, for 2022.
"Power disruptions in China have led to production capacity curtailments that, together with delayed ramp-ups and restarts, have led to significant deficits in 2021 that we expect to continue in 2022 with a tight market balance thereafter," the statement noted.
"Demand for aluminum in the medium and long term will be supported by its application in electrification and energy transition," it added.
The price estimate of copper was raised to $9,250 per ton, from $9,000, for this year, and to $8,500, from $7,500, for next year.
"Copper inventories are at very low levels, less than three weeks’ worth of consumption with exchange stocks at 20-year lows," Fitch said.
"While demand is increasing, mining companies face challenges in obtaining environmental permits for new projects and local communities’ resistance," it added.
The price forecast of nickel was increased to $18,250 per ton, from $16,500, for 2021, and to $16,000, from $15,000, for 2022 "driven by residual effects of low stocks and higher prices in 2021," Fitch said.
Also, the price expectation of zinc was revised up to $2,900, from $2,800 per ton, for this year, and to $2,900, from $2,400, for next year, as a result of global demand growth reaching almost the pre-pandemic level, and global refined zinc market is "likely to swing into shortages" in 2022 and 2023, it added.