Goldman Sachs, the "commodity leader," had previously been bullish on commodities this year, but recently it has been changing its stance. The "commodity 5D bull market" discussed at the end of May is no longer mentioned, and now Goldman Sachs is only bullish on gold.

On September 5th, Goldman Sachs reiterated in a research report that it is still bullish on gold and maintains a target price of $2700 per ounce by 2025. As for other commodities, Goldman Sachs stated that due to weakening cyclical support, its recent attitude towards the commodity market has become more cautious, with a cautious and conservative stance on crude oil, copper, and other industrial metals.

Copper, aluminum, and oil have been "abandoned".

In the research report, Goldman Sachs pointed out that considering the currently high idle capacity, potential trade tensions, and the possibility of OPEC supply exceeding expectations next year, the predicted price range of Brent crude oil has been lowered by $5 per barrel to $70-85.

At the same time, Goldman Sachs has given up its bullish view on copper prices and postponed the timeline for copper prices to reach $12,000 per ton from the end of 2024 to after 2025. Goldman Sachs believes that copper inventories are still increasing, while demand is relatively weak, so the depletion of inventories and the subsequent price increase will be delayed much longer than previously expected.

According to media reports, analysts Samantha Dart and Daan Struyven from Goldman Sachs stated in an email this week that they expect the average copper price to be $10,100 per ton next year. Although this expectation is still higher than the current London Metal Exchange price of about $9,200, it is lower than the bank's previous target of $15,000 per ton.

In addition, Goldman Sachs has also lowered its 2025 aluminum price forecast from $2850 per ton to $2540. The bank maintains a bearish view on iron ore and nickel, and states that gold is its preferred hedge against geopolitical and financial risks in the near term.

Goldman Sachs remains confident in gold.

"Gold is the commodity we are most confident in for short-term gains." Goldman Sachs has recently been mentioning similar statements frequently.

Currently, Goldman Sachs maintains a target price of $2700 per ounce for early 2025, believing that the inflow from Western asset management institutions as the Federal Reserve prepares to cut interest rates will drive the bullish trend of precious metals. The continued strong demand from central banks around the world will also provide support. The bank wrote in its report:

Based on the increased demand for gold from central banks, the expected interest rate cut by the Federal Reserve, and the significant advantage of gold as a geopolitical risk hedge tool, we recently recommended a bullish trading strategy for gold.

Current spot gold price is $2497 per ounce. $XAU/USD (XAUUSD.CFD)$ Based on this calculation, Goldman Sachs believes that there is still over 8% upside potential in the gold price by early next year.

Goldman Sachs' "Commodity 5D Bull Market" is now in the past, and the commodity bear market cycle has arrived.

On May 29th of this year, Goldman Sachs pointed out in a report that they are still selectively bullish on commodities, expecting the total ROI in 2024 to rise from 13% to 18%.

Goldman Sachs also mentioned the so-called '5D bull market trend': Disinvestment, decarbonization and climate change, de-risking, datacenters & AI, and defense spending, these trends will bring structural opportunities for commodities.

At that time, Goldman Sachs predicted that gold and copper would continue to rise, oil prices would fluctuate, and natural gas gains would be limited: copper prices are expected to rise by 15% to $12,000 per ton by the end of the year; the target price for gold is expected to be $2,700 per ounce by the end of the year; Brent crude oil prices will fluctuate in the range of $75-90; natural gas prices will have limited upside this summer.

However, the current global commodity market has entered a bear market cycle. HSBC pointed out in a research report on Monday that the commodity market entered a bear market cycle in mid-July and the bear market typically lasts for 3 months. In August, global commodities continued to decline, with oil, iron ore, and copper experiencing the most significant drops. Of the 42 commodities tracked by HSBC, 27 experienced price declines in August.

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