We recently compiled a list of the 10 Best Commodity Stocks to Invest in According to Hedge Funds. In this article, we are going to take a look at where Agnico Eagle Mines Limited (NYSE:AEM) stands against other best commodity stocks to invest in according to hedge funds.
The year 2025 is shaping up to be a mixed bag for commodity markets. While global commodity prices are largely expected to fall due to a sluggish economic outlook and a resurgent U.S. dollar, certain commodities such as gold and gas are poised for a rally. Industry experts and market participants are closely monitoring these trends, particularly in the context of China’s economic policies and global geopolitical developments.
According to Sabrin Chowdhury, the head of commodities analysis at BMI, commodities in general will face pressure across the board in 2025. The strength of the U.S. dollar is expected to cap demand for commodities priced in the greenback, making them more expensive for buyers using other currencies. This trend is likely to be exacerbated by a sluggish global economic outlook, which will dampen demand for raw materials and energy resources.
Gold prices, which notched a series of all-time highs in 2024, are expected to continue their upward trajectory in 2025. Adrian Ash, director of research at BullionVault, a gold investment services firm, attributes this optimism to investors’ pessimism about geopolitics and government debt. Gold’s role as a hedge against risk and inflation makes it an attractive asset in uncertain times. JPMorgan analysts also forecast a rise in gold prices, particularly if U.S. policies become more disruptive, leading to increased tariffs, elevated trade tensions, and higher risks to economic growth. Gold prices, which rose about 26% in 2024, are forecast to reach $3,000 per ounce in 2025.
Global natural gas prices have rallied since mid-December 2024, driven by cold weather and geopolitical tensions. Ukraine’s recent halt of Russian gas flow to several European nations on New Year’s Day has introduced greater uncertainty to the global gas markets. As long as the cutoff remains in place, gas prices are likely to remain elevated. BMI forecasts gas prices to rise by about 40% in 2025 to $3.4 per million British thermal units (MMBtu), driven by growing demand from the LNG sector and higher net pipeline exports. LNG will continue to drive new consumption, supported by rising export capacity and strong demand in Europe and Asia, according to BMI analysts.
READ ALSO: 12 Most Promising Green Stocks According to Hedge Funds and 10 Worst Performing Energy Stocks in 2024.
Crude oil prices are expected to slip in 2025, continuing the trend from 2024, which saw prices dragged down by weak Chinese demand and a supply glut. The International Energy Agency (IEA) forecasted global oil demand to grow by under a million barrels per day in 2025, a significant slowdown compared to the two million barrels per day increase in 2023. Commonwealth Bank of Australia expects Brent oil prices to fall to $70 per barrel this year, citing increased oil supply from non-OPEC+ countries that will likely outpace the rise in global oil consumption. BMI noted that the first half of 2025 is likely to see a supply glut as substantial new production from the U.S., Canada, Guyana, and Brazil comes online. If OPEC+ plans to roll back voluntary cuts materialize, the oversupply will further pressure prices.
Silver is expected to see price increases in 2025, driven by strong industrial demand. Silver is used in a variety of applications, including solar panels, automobiles, jewelry, and electronics. The demand for solar power, in particular, is expected to remain resilient, and the metal’s supply is limited.
Copper, a key material in the manufacturing of electric vehicles and power grids, may see a dent in prices in 2025. The metal reached a record high in May 2024, largely due to a squeezed market and the global energy transition. However, a potential deceleration in the energy transition, driven by policy shifts, might dampen the “green sentiment” that bolstered prices in 2024. John Gross, president of John Gross and Company, a metals management consultancy, expects copper prices to trend lower in 2025 due to a cocktail mix of high interest rates, elevated interest rates, and a stronger dollar, which will weigh on all metals markets.
Iron ore prices are forecast to drop in 2025, driven by an oversupply resulting from Chinese policies and geopolitical factors. Goldman Sachs expects prices to decline to $95 per ton in 2025, citing the expected U.S. tariffs on China, the changing nature of Chinese stimulus, and the introduction of new low-cost supply. Despite China likely importing a record amount of iron ore this year, the market is expected to move into a surplus, leading to a decline in prices.
The global commodity markets in 2025 are expected to be characterized by a mix of trends, with some commodities facing headwinds while others continue to rally. However, commodities are a solid investment option due to their inherent scarcity and long-term value as demand continues to grow.
A macro view of a gold mine, with miners hard at work in the foreground.
Our Methodology
To compile our list of the 10 best commodity stocks to invest in according to hedge funds, we used commodities ETFs to compile a list of 25 companies that are involved in mining, trading or processing of commodities. We then used Insider Monkey’s Hedge Fund database to rank 10 stocks with the largest number of hedge fund holders, as of Q3 2024. The list is sorted in ascending order of hedge fund sentiment.
Why do we care about what hedge funds do? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).
Agnico Eagle Mines Limited (NYSE:AEM)
Number of Hedge Fund Investors: 54
Agnico Eagle Mines Limited (NYSE:AEM) is a leading gold mining company with operations in Canada, Australia, Mexico, and Europe. The company is known for its high-quality mines, including Meadowbank, Meliadine, and Detour Lake in Canada.
Agnico Eagle Mines Limited (NYSE:AEM) is prioritizing the growth of its resource base and the extension of mine life through extensive exploration programs. The company has launched one of its largest exploration initiatives to date, deploying over 100 diamond drill rigs across various sites. Notable successes include the eastward extension of the East Gouldie Zone at the Odyssey project in Quebec and the discovery of high-grade mineralization at the Patch 7 zone in the Madrid deposit area at Hope Bay, Nunavut. The continuous exploration and operational improvements have also extended the life of the Meadowbank and Meliadine mines.
Furthermore, Agnico Eagle Mines Limited (NYSE:AEM) is advancing the development of the Odyssey mine, which is on track to become Canada’s largest underground gold mine by 2028. These discoveries are poised to significantly enhance the company’s resource base and support future production growth. The company recently announced its acquisition of O3 Mining for approximately $150.54 million. O3 Mining’s primary asset is the 100 % owned Marban Alliance property in Quebec’s Abitibi region, which is located adjacent to Agnico Eagle Mines Limited’s (NYSE:AEM) Canadian Malartic complex.
Overall AEM ranks 8th on our list of the best commodity stocks to invest in according to hedge funds. While we acknowledge the potential of AEM as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than AEM but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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Disclosure: None. This article is originally published at Insider Monkey.
