Five key metals for climate adaptation

Until now, much of the focus from governments, industry and multi-stakeholder groups has understandably been on climate mitigation: reducing greenhouse gas emissions in an effort to curb further rises in global temperatures. But climate change is already here, and alongside mitigation there is a growing need to think about adaptation.

Despite this, the implications for metals markets remain relatively unexplored. As one zinc trader in Europe told Fastmarkets: “That’s actually a really interesting topic and something I should spend time looking at.”

The trader added that they have not seen any signals of rising demand for this kind of climate-adaptive infrastructure yet, but some see it as inevitable.

“It is important to understand the current and future operating environment but also consider the expected change in load demand over the next 100+ years,” secretary general of Worldstainless Tim Collins told Fastmarkets by email. “When these two features are appropriately considered, it becomes clear that resilient materials must be considered as part of the overall construction materials palette.” 

To explore how demand for those resilient materials may influence commodity markets in the years to come, Fastmarkets has identified five key metals for climate adaptation, as well as the opportunities, priorities and challenges for their respective markets.

Aluminium

Why it matters

Flooding is a major impact of climate change, with modelling from the United Nations Office for Disaster Risk Reduction suggesting that average losses to infrastructure from riverine flooding alone will increase between 5% and 13% by 2050, resulting in $407 billion-439 billion in annual losses.

“A reliable source of aluminium will mean governments have the ability to produce high-quality flood defenses and improve old grid infrastructure,” Fastmarkets research analyst Andy Farida said, calling it “a key critical mineral that every government needs to store in order to build a robust climate adaptation plan.”

Bjørn Kjetil Mauritzen, senior vice president for group sustainability at Hydro, told Fastmarkets that applications will include resilient buildings and facades, bridges and walkways, electricity grids and other infrastructure that must perform reliably under changing weather conditions.

“Aluminium can play an important role because it combines strength, low weight, corrosion resistance, design flexibility and recyclability,” he said, adding that it will be most in demand “where durability, corrosion resistance, low weight and circularity provide clear lifecycle advantages.”

Priorities and challenges

“We are seeing growing interest in aluminium for infrastructure, energy systems and building applications where resilience, durability and security of supply matter,” Mauritzen told Fastmarkets, while noting that it is not always possible to attribute changes in demand to a single cause.

“As governments and companies invest in upgrading grids, buildings, transport links and other critical infrastructure, aluminium is well positioned to contribute,” he said.

Among the priorities for meeting greater demand, Mauritzen identified access to material that is not overly dependent on vulnerable supply chains, greater use of recycled and recyclable material and closer collaboration across industries to help meet changing technical requirements.

According to Fastmarkets’ research team forecasting data, global aluminium consumption is expected to outpace production in 2026, with demand reaching 75.44 million tonnes compared with output of 73.51 million tonnes.

Mauritzen told Fastmarkets that the scale and timing of future investment will pose a challenge as new production, recycling and renewable energy capacity will require significant capital and lead times, with energy being of particular importance. “Aluminium is energy-intensive, so sufficient access to competitive renewable power is fundamental,” he explained.

“This also requires strong incentives from government mandate as well as no barrier to costs and price to acquire the amount of aluminium needed,” Farida said. “When you prioritize the climate, certain parts of the economic activity will suffer as a result.”

Zinc

Why it matters

“Climate change leads to widely fluctuating temperatures, intense rainfall, coastal flooding and increased humidity, all of which accelerate corrosion,” executive director of the International Zinc Association (IZA) Dr Andrew Green told Fastmarkets.

“More than 60% of all zinc is used to coat the steel used in infrastructure for buildings, bridges, railways, roads, cars, ships and water and sewer systems,” he added. “A protective zinc coating can double or even triple the service life of infrastructure.”

“Compared to other materials, it’s very effective and cost-efficient,” the International Lead and Zinc Study Group’s director of market research and statistics Joao Jorge told Fastmarkets.

To illustrate zinc’s importance, Fastmarkets analyst James Moore points to the Ponte Morandi bridge in Genoa, which collapsed during a rainstorm in 2018, killing 43 people and raising serious questions about the state of European infrastructure generally.

Green also emphasized zinc’s role in securing food supplies as climate change impacts farmland, highlighting research from Brazil that has identified the need for 40,000 tonnes of zinc micronutrient fertilizer to restore depleted farmlands.

While both producer and trader sources told Fastmarkets that they are unable to confirm how much of rising zinc demand can be pegged directly to climate adaptation, Green said that the IZA is already seeing an increase. He gives more prevalent specifications for zinc coatings from engineers and architects as an example, and expects the trend to accelerate as climate change worsens.

Priorities and challenges

“Collaboration and coordination are key to ensuring a robust supply chain for zinc and its highly valued coproducts germanium, gallium and indium,” Green said. “While the zinc industry focuses on scaling commercialization of high-demand products such as batteries and building galvanizing lines to meet corrosion-protection needs, governments must coordinate with industry to secure and augment the zinc supply chain.”

However, they will do so in the face of significant challenges. “This year energy costs are the big thing impacting production,” James Moore explained. “But smelters are also struggling with very tight concentrates supplies. Ore grades are also falling as operations such as the Red Dog mine in Alaska exhaust their resources, and the long lead times affecting most metals mining are only compounded by rising finance costs.”

According to an announcement from the International Lead and Zinc Study Group on Monday October 19, world zinc mine production is forecast to decline by 2.6% to 12.40 million tonnes in 2026, while global demand is forecast to rise by 1.4% to 14.02 million tonnes. In 2027, the group forecasts production and demand of 12.78 million tonnes and 14.19 million tonnes respectively.

“On average, the licensing and construction of a zinc mine takes 15-20 years, and current production capacity cannot meet 2035 demand, resulting in a potential zinc shortage,” Green explained, with Fastmarkets’ research team’s analysis suggesting a deficit in the refined market in 2027 due to strong demand and constrained supply.

Copper

Why it matters

When it comes to rising temperatures, “pretty quickly the focus hones in on what might become a cooling crisis — the proliferation of air conditioning in regions that, up to now, have not widely adopted it,” Fastmarkets principal analyst Andrew Cole said, pointing to the UK residential market as an example. “This is going to boost copper demand in heat exchangers, coils, compressors and HVAC systems.”

Bernardo Nascimento, policy manager for energy and climate at the International Copper Association, echoed this.

“Copper demand for power grids, building installations and cooling equipment represent almost 50% of global copper use,” he told Fastmarkets. “Airconditioning and refrigeration equipment represents almost 10% of copper demand and grew 51% over the period 2012-2025, while total copper demand grew 32% over the same period.”

Nascimento also pointed to water infrastructure and critical facilities as important aspects of adaptation. “Desalination, wastewater treatment, water reuse and pumping systems rely on copper in pumps, power supplies and heat exchangers,” he said, adding that “uninterruptible power supplies, backup generation and more robust electrical installations all add copper demand.”

“And, of course, there will be added grid stress,” Cole said.

According to Nascimento, “Higher ambient temperatures reduce the current-carrying capacity of cables and equipment. Maintaining capacity can therefore require additional conductor and equipment, increasing copper use.”

Priorities and challenges

“We do not attempt to separate copper demand for these overlapping drivers, but overall, global copper demand has seen a compound annual growth rate (CAGR) of 2.2% per year over the period 2012-2025,” Nascimento told Fastmarkets. “There is a clear trend towards the revision of electrotechnical standards to make buildings and grids more resilient and to take increasing ambient temperatures into account.”

However, recent developments have also exposed challenges. “We’ve seen with most big waves of new demand (AI the latest one) that supply is slow to meet the growth in the market’s needs. This climate adaptation demand will be superimposed on the broader energy transition and data center mega trends that the copper industry is already struggling to supply,” Cole explained.

“At the same time, copper production itself is significantly exposed to climate variability, including the El Niño Southern Oscillation,” Nascimento said.

Fastmarkets reported on October 18 that extreme weather has already had a significant impact on Chilean copper production in 2026, and on September 8 that LME three-month copper had reached a new all-time high of $14,624.50 per tonne, owing to dollar weakness, renewed demand from optimism over AI, regional inventory tightness and mine-supply concerns.

“Given lower grades, high capex and long lead times for new projects in the mining sector, the copper industry and policymakers should prioritize advancing recycling infrastructure and expanding recycling capacity in order to minimize a dangerous structural supply lag,” Cole said, noting that the necessities of climate adaptation are likely to see continued bullishness. “To incentivize the investment required, copper prices will have to stay higher for longer.”

Molybdenum

Why it matters

“Molybdenum is likely to play an increasingly important role in climate adaptation because relatively small additions to steel and other alloys can enhance infrastructure’s corrosion resistance, heat tolerance and durability,” Fastmarkets analyst Emre Uzun said.

Pointing to specific use cases, secretary general of the International Molybdenum Association [IMOA] Eva Model told Fastmarkets that, as temperatures rise, “molybdenum-containing Type 316 stainless steel is being used in architectural sunshade systems that help reduce solar heat gain and lower cooling demands in buildings.”

Among notable examples, Model noted the Federal Building in San Francisco and Harvard University’s Science and Engineering Complex.”

In the context of rising sea levels, Model also explained that “molybdenum-containing duplex stainless steels are widely used in demanding marine and coastal environments.”

This includes flood-control and water-management projects for sites such as France’s Mont-Saint Michel, Stockholm’s Slussen area and the Garda Damme flood barrier in Gothenburg.

She added that molybdenum-containing stainless steel service lines have been shown to curtail water loss, reducing the need for repairs in some of Asia’s largest cities and prompting trials in Europe.

“Molybdenum-containing stainless steel dowel bars play a key role in Qatar’s mega reservoirs designed to supply water to its expanding population amid increasing desert temperatures,” she said.

Priorities and challenges

“Although demand from the [climate] adaptation process is unlikely to surpass established end uses as the main driver of molybdenum consumption in the near term, it should generate an additional, sustained demand base for higher-performance materials,” Uzun explained.

Model echoed this view, noting that “as the impacts of climate change become more pronounced, we expect demand for durable, high-performance molybdenum-containing materials to grow.”

Since molybdenum is primarily a co-product of copper, markets face similar tightness owing to a lack of mining capacity and long lead times for developing more.

According to IMOA, global molybdenum production fell by 3% to 167.2 million lbs in the second quarter of 2026, while global usage rose 8% to 177.5 million lbs in the same period. China remained the largest producer and user of the metal.

“They are the biggest producer of primary Mo and the biggest importer,” one US-based producer told Fastmarkets. “This leaves the rest of the world challenged for units and has led to high prices.”

“The main challenge would likely be that supply may not respond readily to stronger demand or higher prices,” Uzun explained. “Availability depends more on investments, ore grades and mine scheduling in these markets rather than on molybdenum prices. This concentrated supply base, limited supply flexibility and relatively tight recent supply conditions further complicate the outlook, making supply responsiveness increasingly important as [climate adaptation] applications expand.”

Nickel

Why it matters

“As climate change is expected to increase corrosion risks in many settings, nickel-containing stainless steels contribute to more durable coastal infrastructure, flood protection systems, water treatment and desalination facilities, pumping stations, bridges, buildings and other critical infrastructure,” a spokesperson from the Nickel Institute told Fastmarkets.

Tim Collins explained that “today, there are many examples around the world of degrading infrastructure with, in many developed countries, around 15% of existing infrastructure being classified as structurally deficient.” He added that nickel-containing stainless steels, including duplex stainless steels, are a “gamechanger.”

While noting that stainless steel currently has limited applications in structural construction, Fastmarkets principal analyst Olivier Masson suggests that we may see an increase in alloy steel applications for flood defenses. He added that “there is a push to use more 304 in construction rebar, because carbon steel rebar can corrode, for example in bridges.”

Speaking to Fastmarkets, Collins offered the example of Montreal’s Samuel-De Champlain Bridge, which was replaced in 2019.

“During its operating life of just 57 years, the ongoing expense of maintaining the bridge was around 10 times the original cost of creating the structure,” he said. “The new Champlain Bridge was designed using around 15kt of nickel-containing duplex stainless steel against the requirement that the bridge needed to have an operating life of >120 years with minimal maintenance.”

Priorities and challenges

As Fastmarkets analyst Olivier Masson points out, climate adaptation remains a relatively niche use case for nickel, and is not currently having an outsized impact on the market.

A statement from the International Nickel Study Group on October 13 indicated a surplus, saying: “World primary nickel production was 3.589 [million tonnes] in 2024 and 3.875 [million tonnes] in 2025, and is forecast to reach 3.868 [million tonnes] in 2026 and 4.071 [million tonnes] in 2027.

The estimates do not include an adjustment factor for possible production disruptions. […] World primary nickel usage was 3.473 [million tonnes] in 2024 and 3.577 [million tonnes] in 2025, and is forecast to increase to 3.849 [million tonnes] in 2026 and to 4.002 [million tonnes] in 2027.” 

Despite production and usage being broadly balanced, Jérôme Baudelet, chief executive officer of Eramet Indonesia, told Fastmarkets that “inventories accumulated during previous years of market surpluses continue to weigh on nickel prices, putting pressure on producers’ margins and challenging their ability to remain competitive while investing in more responsible and sustainable production practices.”

As Fastmarkets reported on September 30, El Niño-driven drought in Indonesia has also disrupted processing operations for the world’s largest nickel producer, impacting market sentiment.

“Over the longer term, the industry will need to balance these operational and economic constraints with evolving demand and investment requirements,” Baudelet said.

Collins suggests that these evolving demand requirements may be influenced by changing norms in construction, maintenance and business.

“As a global society, we need to get away from established norms including ‘lowest bids win contracts,’ ‘maintenance is lucrative’ and ‘resilient materials are difficult to work with,’” he said. “We need to exploit the full scale of benefits that resilient materials including nickel-containing stainless steels offer.”

Niall Beamish, Julienne Raboca, Laura Roberts, Benjamin Wein and Andrew Wells contributed to this report. 

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