Published on 03 August 2026

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NATURAL RESOURCES MARKET UPDATE H2 2026: MINING AND HEAVY INDUSTRY

Published on 03 August 2026

Geopolitical volatility, an accelerating energy transition, and the ongoing data revolution are combining to redefine the mining sector, and these trends are expected to continue beyond 2026.

INDUSTRY OUTLOOK

Forecast difficulties in maintaining and expanding the required knowledge base due to a shrinking talent base poses additional challenges in navigating a demanding sector.

• Recent geopolitical instability has driven record gold and precious metal prices while elevating mining's strategic importance, with critical minerals increasingly viewed as assets of national significance. This is particularly evident for commodities with defence applications, including cobalt, graphite, and rare earth elements. In response, governments are seeking to secure supply chains and are showing greater willingness to support the sector through investment and more favourable regulatory frameworks.
• The transition to a clean energy economy is expected to widen supply — demand gaps for key commodities, requiring mining companies to significantly scale output to meet future needs. This shift creates substantial revenue opportunities but also introduces complex challenges, including ESG and reputational risks, rising capital intensity, and longer project timelines. At the same time, advances in technology and recycling may temper long-term demand, adding further uncertainty to investment decisions.
• The reducing volume of easily accessible deposits combined with rising extraction costs has seen net profit margins of 40 leading mining companies reduce from 24% in 2011 to 10% in 2025,¹ making operational efficiency critical for survival. This challenging environment has seen the industry increasingly looking to the improvements and efficiencies available through accessing AI, automation, and data to maximise their productivity and profitability.
• The mining sector's longstanding skills shortage is expected to intensify as retirements rise and talent pipelines lag, with gaps in critical areas such as mine planning, engineering, sustainability, and regulatory compliance undermining productivity, safety, and future supply. Addressing this challenge will require a concerted effort to reposition mining as a critical enabler of the energy transition and digital economy, while improving diversity, equity, and inclusion to broaden the available talent pool.

INSURANCE OUTLOOK

The insurance market for mining and heavy industry risks is expected to remain broadly stable through the second half of 2026, with continued rate softening across most regions and classes of business. However, the market is increasingly characterised by a divergence in underwriting philosophy between specialist mining insurers and non-specialist property carriers.

A relatively benign period for global natural catastrophe losses has strengthened insurer balance sheets and preserved underwriting capital. As pricing continues to soften in less challenging property sectors, a growing number of carriers are seeking premium growth opportunities in traditionally complex industries such as mining and heavy industry, with new entrants to the space seeking dedicated mining underwriting resource and expanding capacity and appetite for sector risks. At the same time, domestic market capacity has expanded significantly, with particularly strong competition emerging in Canada, Latin America, and Africa.

The growth in available capacity, both within local markets and across the international marketplace, is increasing competition and providing insureds with a broader range of options. This has intensified downward pressure on pricing and created challenging conditions for specialist mining insurers. Many dedicated mining and heavy industry carriers have experienced several years of large-loss activity, resulting in continued pressure on portfolio profitability. Against this backdrop, a number of specialist insurers are now writing business at, or close to, minimum technical pricing levels, while also facing increasing competition from carriers seeking to establish or expand their presence in the sector.

This competitive environment has contributed to a gradual shift in placement strategies. In some cases, business has moved away from traditional mining insurers towards transactional or domestic capacity providers. This trend is not solely driven by pricing considerations. Increasing levels of local retention have reduced the participation of some international markets, creating additional pressure on long-standing insurer-client relationships where historical order sizes have materially reduced.

Despite these challenges, specialist carriers are expected to maintain a disciplined underwriting approach. Underwriters remain focused on asset valuations, loss scenarios, maintenance standards, and operational resilience. Recent large losses have reinforced concerns around asset concentration, supply chain dependencies, and the growing scale of business interruption exposures across the sector.

Commodity prices are also expected to play an increasingly important role in underwriting decisions. Elevated prices for gold, copper, and other strategic minerals have significantly increased revenue generation and earnings potential for many mining companies, resulting in materially higher business interruption values at risk. In many cases, insured values have not increased in line with underlying exposure growth, nor has sufficient consideration been given to whether existing coverage limits remain appropriate for current operating conditions.

Consequently, insurers are expected to place greater emphasis on weighted rate adequacy than on headline rate movements alone, seeking to ensure premium levels adequately reflect the increased earnings exposures being assumed. Higher insured values and increased limit purchases may also help support overall premium volumes, even as market rates continue to soften.

For insureds, increased competition is expected to create meaningful opportunities beyond pricing improvements. The abundance of available capacity is likely to support higher limit deployment, broader policy terms, and expanded coverage options, as insurers seek to differentiate themselves through coverage enhancements and strategic deployment of capital rather than competing exclusively on rate. As a result, well-managed mining and heavy industry risks are expected to benefit from one of the most favourable buying environments seen in recent years, provided adequate attention is given to valuation accuracy and exposure management.

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Source

¹ "Tracking the Trends 2026," Deloitte, accessed 23 July 2026. PDF file.