Summary
HSBC has updated its recommendations on a roster of EMEA miners to reflect disruption in commodity supply chains linked to the Middle East conflict. The bank upgraded Glencore to Buy from Hold and raised its target price to 620p from 510p, while maintaining Buy ratings on African Rainbow Minerals and Exxaro Resources and retaining a Reduce on Antofagasta. HSBC also adjusted price and margin forecasts across a number of commodities and companies, citing heightened risk to energy and metal flows.
Coverage changes and target revisions
On Tuesday HSBC upgraded Glencore to Buy and increased the target price to 620p from 510p. The bank kept its Buy stance on African Rainbow Minerals and Exxaro Resources, and sustained a Reduce rating on Antofagasta. Exxaro's target was lifted to ZAR300 from ZAR250, and African Rainbow Minerals' target was moved to ZAR290 from ZAR285.
For Exxaro, HSBC said the South African miner "could generate excess cash returns over the next 12-18 months as coal and iron ore prices are relatively elevated," which could underpin higher dividends or potential acquisitions after its recent manganese asset purchase. In the case of African Rainbow Minerals, the bank cited improving PGM fundamentals and the prospect of cash returns from its stake in Harmony Gold. HSBC also increased the EBITDA multiple applied to ARM's coal assets from 3x to 4x to reflect a view that energy shortages could support sustained cash generation from those assets.
Commodities in focus
Analyst Shilan Modi identified aluminium, copper, platinum and rhodium as HSBC's preferred metals. HSBC emphasized that aluminium is particularly exposed, noting the Middle East accounts for roughly 23% of ex-China aluminium production, which makes it the commodity most directly affected by the current disruptions.
Modi also flagged a set of knock-on effects that could persist beyond any ceasefire: "sulphur scarcity, freight disruptions, and cost inflation" that may weigh on markets for months. "Metals prices were already being squeezed higher by supply disruptions over the past several years," the analyst wrote. "Potential further disruptions to the global supply chain and cost inflation will help support prices at elevated levels, in our view." He added: "The key risk centres around demand destruction from lower economic growth."
Price and margin assumptions
HSBC made a sizable upward revision to its thermal coal outlook, increasing its 2026 spot price estimate by 29% to $135 per tonne on concern about potential energy shortages. That change underpins much of the bullish case for Glencore and Exxaro, both of which have material coal exposure.
For Glencore specifically, HSBC increased near-term marketing EBITDA margin estimates, arguing the company's trading operations stand to benefit from rapid commodity price swings and greater demand for traded energy. Modi noted an upside scenario in which stronger-than-expected marketing margins and a ferrochrome restart in South Africa could push the stock's fair value up to 685p.
Macro outlook and operational risks
HSBC economists project global inflation to accelerate to 3.5% in 2026 while global growth slows from 2.8% to 2.5%. The bank also outlined a more severe downside scenario in which the Strait of Hormuz remains effectively closed for an extended period, potentially tipping parts of the world into recession.
On operational resilience, HSBC noted that EMEA miners typically keep about four weeks of fuel onsite, which provides a buffer but may not be sufficient if shipping disruptions continue. Modi highlighted bunker fuel shortages as the largest risk to export supply chains, a condition that could disrupt shipments and impact producers' ability to move product to market.
Implications for investors
HSBC's re-rating and target adjustments reflect the bank's assessment that supply-side shocks and energy market volatility will support prices for certain metals and coal. The bank's changes boost the investment case for companies with coal exposure and commodity marketing operations, while highlighting a mixture of elevated price assumptions and macro risks that investors should weigh.