The global energy transition, intensifying resource competition, and the AI industry boom are transforming industrial nonferrous metals. They are evolving from cyclical commodities that follow macroeconomic fluctuations into strategic scarce assets, crucial for supply chain security and the development needs of emerging industries. Starting May 26, 2026, the Huatai-PineBridge Industrial Nonferrous Metals ETF (560490) will be officially listed on the Shanghai Stock Exchange, providing investors with a tool to focus on the core value of the industrial metals supply chain.
The Huatai-PineBridge Industrial Nonferrous Metals ETF (560490) tracks the CSI Industrial Nonferrous Metals Theme Index. This index comprises 30 leading companies in the industrial nonferrous metals sector, including copper, aluminum, lead, zinc, and rare earth metals, offering a concentrated focus on the core industrial metals space. The combined weight of copper, aluminum, and rare earth stocks in the index exceeds 65%, which is higher than comparable indices like the CSI Nonferrous Metals Index (52.51%) and the CNI Nonferrous Metals Index (54.71%). This high concentration is expected to capture the high-volatility characteristics of industrial metals effectively. The index's top five holdings include representative industry leaders such as
Against the backdrop of sustained economic recovery trends, accelerated global energy transition, and the comprehensive rollout of AI infrastructure, the industrial nonferrous metals sector is poised for an upward cycle driven by multiple forces. Rigid constraints on the supply side, coupled with long-term structural growth in demand, signal a fundamental improvement for the sector. Additionally, increased policy support is aiding the recovery of industry sentiment.
In 2025, eight departments including the Ministry of Industry and Information Technology jointly issued the "Work Plan for Stabilizing Growth in the Nonferrous Metals Industry (2025-2026)." Focusing on core issues like resource security and high-end supply, the plan explicitly sets targets, including an average annual growth of around 5% in industry value-added and recycled metal production exceeding 20 million tons. Amid heightened geopolitical tensions and great-power technological competition, industrial nonferrous metals, as the "lifeblood of the real economy," are closely linked to industrial chain resilience and national security imperatives, suggesting their strategic value may become increasingly prominent.
From a supply-demand perspective, some industrial nonferrous metals exhibit strong supply rigidity, constrained by factors such as prolonged low capital expenditure, lengthy mine development cycles, and carbon reduction pressures, resulting in significant supply constraints. On the demand side, factors like the energy structure transition and AI industry transformation are driving accelerated demand from emerging sectors such as AI data centers and power grid upgrades. The incremental demand for basic materials like copper and aluminum is substantial. The industry's tight supply-demand balance is expected to widen, potentially opening further room for an upward cycle in industry sentiment.
Optimizing industry supply-demand dynamics and recovering sentiment are driving accelerated profit improvements for the sector. As of the Q1 2026 financial reports, the average year-on-year growth rates for revenue and net profit of the Industrial Nonferrous Metals Index constituents were as high as 31.79% and 95.84%, respectively, indicating a strong overall recovery momentum for the industrial chain. Wind data shows that as of May 21, 2026, the target index gained 94.98% over the past year, significantly outperforming comparable market indices like the CSI Nonferrous Metals Index (80.85%) and the CNI Nonferrous Metals Index (83.08%) over the same period.
Simultaneously, following a prolonged period of adjustment, the sector's valuation remains in a historically low range. Wind data indicates that as of May 21, 2026, the Industrial Nonferrous Metals Index's price-to-earnings ratio was only 18.36 times, sitting at the lower 19.23rd percentile since the index's launch on July 22, 2009. This is lower than the historical percentile levels of the CSI Nonferrous Metals Index (28.67%) and the CNI Nonferrous Metals Index (23.56%) over the same period, suggesting strong potential for valuation recovery during the industry's upcycle.
Driven by the combined catalysts of policy support and fundamental improvement, the industrial metals sector may present a favorable long-term investment window. However, industrial metals are cyclical, involve complex varieties, and are significantly influenced by macroeconomic and commodity price fluctuations, making direct stock investment challenging. Capturing the overall opportunities across the industrial chain through index-based investing may be a more suitable approach. The Huatai-PineBridge Industrial Nonferrous Metals ETF (560490), which begins trading on May 26, provides investors with a new tool for accessing opportunities in the industrial nonferrous metals supply chain.
The manager of the Huatai-PineBridge Industrial Nonferrous Metals ETF (560490), Huatai-PineBridge Fund Management, is one of China's first ETF providers, with over 19 years of passive investment management experience. As of the end of 2025, Huatai-PineBridge Fund has been awarded the title of "Passive Investment Golden Bull Fund Company" eight times and has won a total of 18 Golden Bull Awards in the passive investment field, demonstrating strong index operation capabilities.
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