The shortages that markets are still not pricing
Clue: It not a demand problem, but a supply one
I don’t usually read commodity research. Most of it is price-led, cyclical and overly confident in how quickly supply can respond.
However, a recent piece from The Contrarian Capitalist stopped me for a different reason. It doesn’t focus on prices at all. It focuses on timelines, capital intensity and physical constraints. Once you look at those, a number of comfortable assumptions start to look shaky.
The article’s central point is simple. Many of the commodities that underpin energy systems, electrification and industrial policy are moving into structural imbalance, not because demand is unusually strong, but because supply has become slow, fragile and difficult to scale. Take a look at the chart below:
Source: Contrarian Investor
This is not about short-term disruptions. It is about the cumulative effect of underinvestment, declining ore grades, longer permitting cycles and rising political risk. And you can see this now in the silver market, which is why silver prices have been driven to record highs. Mining timelines that once took years now stretch into decades. Capital expenditure has lagged in real terms. Recycling helps, but it does not scale fast enough to compensate.
At the same time, demand is no longer discretionary. Electrification, grid expansion, defence procurement and data centre build-outs are policy commitments. Once made, they lock in material demand regardless of price.
The article walks through where this mismatch is already visible and where it is likely to emerge next. Silver stands out for its persistent deficits driven by industrial use. Copper emerges as the most important bottleneck of all, sitting at the centre of grids, electric vehicles and renewable infrastructure, yet constrained by long development timelines and declining ore quality. Battery metals appear balanced only under optimistic assumptions about project delivery and geopolitics. Aluminium, often treated as abundant, is quietly tightening as energy costs and capacity limits bite.
Markets are still focused on prices. This article focuses on the system behind them. That is why it stands out.
Brillaint piece on shifting the focus from price signals to actual supply dynamics. The point about policy commitments locking in demandregardless of price is huge, kinda saw this firsthand in energy procurement where contracts had zero flexibility once signed. What really stands out is how declining ore grades compound with permitting delays, which means even high prices wont unlock supply fast enuf. The market seems to price risk like its 2010 still.