Global materials sector shows resilience amid geopolitical shifts

Profits sustained at US$1.3trln, despite revenue contraction to US$6.7trln, reports McKinsey.

This follows a period of price volatility. Specifically, metals and mining revenue declined by 6% to approximately US$3trln, reflecting a cyclical reset driven by price adjustments across major commodities like thermal coal, steel and battery materials.

Nevertheless, profitability remained resilient at US$1.3trln, with metals and mining accounting for US$700bln – making 2024 one of the strongest earnings years in two decades, according to McKinsey & Company. This was achieved despite mounting cost pressures from declining ore grades, labour shortages and environmental requirements.

The analysis reveals a shift in profit pools away from coal and steel towards gold, copper, and aluminum.

Productivity has also risen 1% annually since 2018, largely driven by automation and digitalisation.

The figures came with the release of McKinsey & Companies' Global Materials Perspective 2025. It provides a system-wide view of how metals and mining are navigating profitability resilience, shifting demand and a more fragmented global market against the backdrop of slowing energy transition momentum in some regions.

Highlights from the report include:

• Capital markets remained robust with total shareholder returns growing 3.5 times since 2015 and market capitalisation doubling over the same period
• In 2000, the top 10 metals and mining companies by market cap controlled 60% of the industry; by 2024, that share was 30%.
• NATO Europe defence spending is projected to drive 8% of copper, 4% of steel and 2% of aluminium demand by 2030.
• AI-driven data centres could represent more than 3% of global copper demand by 2030.

Over the 2000-24 period, players in China and North America increased their market shares while Europe’s share decreased to 11%, and the steel industry saw its share decline from around 20% in 2000 to 10% in 2024.