Rosa Leo, Associate Equity Investment Specialist, Aberdeen
Explore how Future Minerals is positioned to support energy transition. Uncover the critical minerals enabling electrification, AI and renewable infrastructure and the long‑term investment opportunities created by rising demand and constrained supply.
Global energy consumption is accelerating. It's being driven by power-hungry artificial intelligence (AI) development, the rise of robotics and automation, and the electrification of transport and industry. At the same time, the energy transition is intensifying investment in renewable power, alongside the need for significant grid building and modernisation.
These trends are highly dependent on a relatively small group of critical minerals — including copper, aluminium and rare earth elements — which are essential for electric vehicles, batteries, semiconductors and renewable infrastructure. Demand for these materials is rising, while supply remains constrained because of long project lead times and limited new capacity. This imbalance may provide sustained pricing support and attractive long-term investment opportunities.
The abrdn SICAV I — Future Minerals Fund invests in global companies that are positioned at the forefront of this transition — both within the extraction industry and across the wider minerals value chain.
Our Investment Process
A key differentiator of our fund is its quality-led, ESG (environmental, social and governance)-integrated approach. From an initial universe of around 1,500 companies, inclusion requires at least 20% revenue exposure to the future minerals theme, alongside robust quality and ESG credentials. As a Sustainable Finance Disclosure Regulation Article 8 fund, companies must pass ESG screens, with a preference for strong governance, environmental practices and risk management. This helps to mitigate tail risks in a complex and often volatile sector.
The portfolio invests across four core areas:
- Mineral extraction and processing (over 60%);
- Upstream and downstream value-chain exposure (15-30%);
- Compounds and advanced materials (5-15%);
- Recycling and sustainability solutions (5-10%).
- This structure provides diversified exposure across the full minerals ecosystem, rather than reliance on pure-play miners alone.
Outlook for 2026
Despite heightened geopolitical uncertainty, commodity markets performed strongly in 2025. We think this momentum will extend into 2026. A broad rotation away from software and growth-heavy assets towards hard assets and materials supports our position. The fund currently has around 75% exposure to mining companies — an area where investors remain structurally underweight, with basic materials accounting for just 3.8% of the MSCI All Countries World Index (Morningstar, 31 January 2026).
Opportunities
In a concentrated global-equity market, the fund offers diversification through low US exposure and minimal exposure to technology — two areas that dominate global indices.
Structural demand drivers are also becoming more visible. Electrification, renewable energy deployment, grid upgrades and rapid AI adoption are increasing global energy intensity. Copper is central to this demand. Recent geopolitical tensions in the Middle East have further underscored the strategic importance of these minerals. They reinforce electrification and renewable energy as key pathways to greater energy security and reduced reliance on oil and third-party energy sources.
Data centres currently account for around 3% of US energy consumption, a figure projected to increase to around 12% by 2030 (McKinsey, 2024). Meeting this demand reinforces the need for both clean energy infrastructure and the minerals required to build it.
Geopolitics adds further opportunities. Many critical materials, including rare earths, remain highly concentrated in China. Efforts by the US and EU to diversify supply chains are accelerating, which creates opportunities in regions that are trying to de-risk their mineral value chains. MP Materials, the fund's top contributor in 2025, illustrates this trend, and we expect further ex-China beneficiaries to emerge during 2026.
While commodity markets can be volatile and short-term cyclicality is to be expected, we believe the long-term fundamentals of the asset class remain structurally attractive. The fund is well-positioned to capture opportunities in 2026 and beyond.
Key sectors in the portfolio
Copper miners
Copper is the poster child of critical minerals. It's a key theme within the portfolio, with around 30% exposure. It's fundamental to electrification and has no practical substitute as an electricity conductor. Following a 44% rise in the London Metal Exchange's spot price in 2025, demand resilience will be tested in 2026. However, copper's relatively low cost within end-use applications suggests higher prices can be absorbed without affecting demand.
Supply remains constrained because of disruption at major producers and long project lead times, while merger and acquisition activity highlights the strategic value of high-quality assets. We expect these supply challenges to keep the market tight well into 2026.
Nuclear demand rising
Uranium is benefiting from a global renaissance in nuclear energy. In 2025, Western governments reaffirmed nuclear power as a core pillar of energy security and decarbonisation. China continues its nuclear expansion at full speed. Inventories have been drawn down over the past decade, mining activity has lagged demand, and supply remains highly concentrated.
With uranium accounting for less than 10% of nuclear operating costs, demand elasticity is extremely low. Against this backdrop, we see 2026 as a potential inflection point for the uranium market. The fund has around 8% exposure to uranium. This includes a holding in Kazatomprom, the world's largest and lowest-cost producer, which also benefits from comparatively strong environmental credentials given its in-situ recovery extraction methods.
To learn more about our Future Minerals fund and how to diversify your clients' portfolios, please visit our website.
Objective: The Fund aims to achieve a combination of growth and income by investing in companies of all sizes listed on global stock exchanges including Emerging Markets, which adhere to the abrdn Future Minerals Investment Approach (the "Investment Approach")
Key risks: (a) The value of investments and the income from them can fall and investors may get back less than the amount invested. (b) The fund invests in equity and equity related securities. These are sensitive to variations in the stock markets which can be volatile and change substantially in short periods of time. (c) A concentrated portfolio may be more volatile and less liquid than a more broadly diversified one. The fund's investments are concentrated in a particular country or sector, or closely related group of industries or sectors. (d) The fund invests in emerging market equities and / or bonds. Investing in emerging markets involves a greater risk of loss than investing in more developed markets due to, among other factors, greater political, tax, economic, foreign exchange, liquidity and regulatory risks. (e) The fund may invest in companies with Variable Interest Entity (VIE) structures in order to gain exposure to industries with foreign ownership restrictions. There is a risk that investments in these structures may be adversely affected by changes in the legal and regulatory framework. (f) Investing in China A shares involves special considerations and risks, including greater price volatility, a less developed regulatory and legal framework, exchange rate risk/controls, settlement, tax, quota, liquidity and regulatory risks. (g) Applying ESG and sustainability criteria in the investment process may result in the exclusion of securities within the fund's benchmark or universe of potential investments. The interpretation of ESG and sustainability criteria is subjective meaning that the fund may invest in companies which similar funds do not (and thus perform differently) and which do not align with the personal views of any individual investor. (h) The use of derivatives carries the risk of reduced liquidity, substantial loss and increased volatility in adverse market conditions, such as a failure amongst market participants. The use of derivatives may result in the fund being leveraged (where market exposure and thus the potential for loss by the fund exceeds the amount it has invested) and in these market conditions the effect of leverage will be to magnify losses.
United Kingdom (UK): Issued by abrdn Investments Luxembourg S.A. 35a, Avenue J.F. Kennedy, L-1855 Luxembourg. R.C.S. B120637. Authorised in Luxembourg and regulated by CSSF. Aberdeen Investments Global is a business name of the foregoing entity.
