This article is the fifth in our special report Outlook 2026, which puts 2025 in the rear-view mirror and spotlights challenges and opportunities in the year ahead. See the other articles here.
Commodities make up a notoriously volatile asset class, and that’s likely the main reason many family offices traditionally don’t invest in them.
According to a recent KPMG global survey, about two-thirds of family offices had no exposure at all. About 22 per cent had between 1 and 5 per cent allocated, and only 8 per cent had the highest allocation—6 to 10 per cent, it found.
Yet this incredibly diverse asset class appears poised for decades of strong growth.
“There’s probably never been a more bullish setup in commodities,” at least since the 1970s, when commodities outperformed stocks and bonds amid higher inflation, says Tim Pickering, founder and chief investment officer of Auspice Capital Advisors Ltd. in Calgary. Auspice manages commodity strategies for family offices and institutional investors along with indices that track the asset class.
Pickering points to tailwinds that are likely to drive growth.
“It’s a long list,” he says, noting that one key driver is lacklustre capital expenditure on the supply side, resulting from 10-plus years of lower overall demand.
That came after a commodity super-cycle of historically high demand that started in the 1990s as China’s economy expanded rapidly. It began tapering off after the 2008 financial crisis. Demand briefly surged again amid the COVID-19 pandemic and the Ukraine War, though it has been followed by uneven performance recently.
Today, however, Pickering sees a setup for long-term growth. “You need two basic ingredients: that extended underinvestment period, and then a generational demand shock, or a series of them.”
Indeed, two demand shocks have factored into higher commodity prices recently, those being decarbonization of the economy and the hyper-scaling of artificial intelligence infrastructure.
In turn, the following commodities could see growth in 2026 and beyond.
Copper
Among the most in-demand commodities for electrification of the economy is copper, says Christine Tan, portfolio manager and member of the investment oversight committee and the asset allocation committee at Sun Life Global Investments. “Copper stands out as having a pretty strong structural demand.”
Supply has not kept pace with demand and cannot easily be increased with current production concentrated among a handful of large mines. “If one has a production disruption, from an accident or a geopolitical event, that will have a meaningful impact on supply.”
Copper prices fared well in 2025, and are up about 30 per cent.
They could continue this upward trajectory, says Jonathan Baird, editor of the Global Investment Letter and a veteran money manager. “On a supply-and-demand basis, you can make a fundamental argument for copper rising even more,” he says.
UBS projected recently that copper could rise to an all-time high of US$13,000 a tonne by next December.
Tan further notes that copper demand will also be driven by AI hyper-scaling, with one recent Bloomberg report forecasting the demand from AI data centres could surpass 4.3 million tonnes of copper by 2035, about 20 per cent of current global production.
Rare earths
Copper isn’t the only material required for the growth of AI and electrification. Other critical minerals are likely to see rising demand from these economic mega-trends.
“The rare-earth elements would be an area of growth potential,” Tan says. “It’s not so much about the ore supply but rather about the processing capacity, with China holding a lot of that.”
China has effectively cornered the rare-earths market, according to a report from Bramston and Associates, a strategic analysis firm. Among those rare earths seeing demand with supply largely coming from China is neodymium, used in electric motors and wind turbines.
Rising demand and limited supply will create new opportunity and volatility for investors of new mine development in Canada, Tan notes.
Bolstering the case for long-term investment is a study projecting that global demand by 2050 could be 26 times today’s.
Silver and gold
Silver is another critical mineral experiencing high demand, “outstripping supply for years,” Baird says. “Now we’re seeing that be reflected in the price,” which has risen all year and could move even higher, potentially reaching US$65 per ounce, according to a Bank of America forecast.
Electrification of the economy and AI are key drivers, given that silver is an excellent conductor and a key component in most electronics.
Similarly, gold has seen significant demand, garnering more investor attention than silver.
“Gold is a commodity, and a store of value,” says Pickering, noting that prices have reached record highs driven by central bank purchases and concerns over rising government debt.
There’s probably never been a more bullish setup in commodities.
Tim Pickering, Auspice Capital Advisors Ltd.
The Bank of America thinks gold could reach US$5,000 an ounce next year.
Pickering notes, however, that other precious metals have equal upside. “Silver has outperformed gold this year, and so have platinum and palladium,” he says.
Oil and gas
Despite forecasts by the International Energy Agency that renewables will make up 36 per cent of all energy demand in 2026, oil and gas are still playing key roles—even in electrification of the economy.
“Energy as a whole is an opportunity,” Pickering says, noting that oil and gas are key energy inputs in the manufacturing and construction of wind and solar assets.
He predicts oil could struggle in the first half of 2026, but it could surprise with rising demand longer term. The growth of the global middle class alone in India and other nations will boost overall energy demand, putting pressure on all sources, oil included.
Investment opportunity, in turn, could emerge from under-investment in production. Notably, oil fell below 30 per cent of total energy demand in 2024 for the first time, the IEA noted in its 2025 energy review, and a World Bank report forecasts oil prices could fall to a five-year low next year.
This dampens production investment, leading to possible upside opportunities that quickly arise with undervalued commodities, Pickering says, and energy overall is undervalued.
Natural gas, in contrast, is forecast to see higher prices in 2026. The Oxford Economics 2026 outlook points to growth in demand from Europe and Asia.
“Asian and European nations are leaning more on LNG [liquified natural gas] as opposed to more carbon-intensive fossil fuels,” Tan notes. Conditions could be beneficial for Canada’s producers, she adds.
Being selective with exposures
Even with natural gas forecast to outperform, Pickering cautions that commodity growth trajectories are often highly volatile, especially over one-year periods. “Even though you can see growth fundamentals, that doesn’t always translate into price growth near-term,” he says.
Given the asset class’s diversity, volatility and many factors affecting demand, active management is often the best risk-adjusted way to get exposure, leveraging expert managers in futures trading who can adjust to fast-changing conditions.
Agricultural commodity prices are a prime example of volatility. Pickering calls them a “sleeping giant” poised to see rising demand from a growing middle class.
But weather and supply chain upheaval, among other factors, can change price directions overnight, he adds.
“So while the long-term drivers are there, growth is far from a straight line upwards.”
Joel Schlesinger is a Winnipeg-based freelance writer who has written for Canadian Family Offices since 2021. Specializing in investment, wealth advice, real estate and personal finance, he is also a regular columnist for the Winnipeg Free Press, and his work regularly appears in The Globe and Mail, Calgary Herald and Edmonton Journal.
The Canadian Family Offices newsletter comes out on Sundays and Wednesdays. If you are interested in stories about Canadian enterprising families, family offices and the professionals who work with them, but like your content aggregated, you can sign up for our free newsletter here.
Please visit here to see information about our standards of journalistic excellence.