Commodities are a key driver of the energy transition and the commodity greenhouse gas (GHG) emissions we cover in our regular analysis account for ~50% of global GHG emissions. CRU's base case analysis finds the commodities sector is on a +2.5–3.0°C trajectory out to 2100. For producers, this translates directly into physical risk to operations, rising compliance and disclosure pressure, and a widening gap between where a business sits today and where customers, investors and regulators increasingly expect it to be.
The cost of warming is real, and carbon emissions are the driver
Global temperature rises have been recorded over the years and the WMO confirmed that 2025 was one of the three warmest years on record, at ~1.4°C above pre-industrial levels, even with La Niña's cooling influence.
Each degree of warming carries a real economic cost. The IPCC AR6 WGII has concluded with high confidence that global economic damages rise with higher warming. CRU's central case, +2.5–3.0°C by 2100, puts 2050 world GDP roughly 12% lower than in a below 2.0°C scenario.
What determines how much the world warms are cumulative carbon emissions. In line with the IPCC's approach, we use a carbon budget method to quantify temperature growth trajectories, normalising commodity GHG emissions to 2019 global emissions and comparing them against the IPCC pathways. This means a sector can be cutting its annual emissions, yet still exceed the carbon budget consistent with a given temperature target, as its carbon emissions pathway keeps adding to the cumulative total.
In our quarterly update of the Energy Transition and Decarbonisation Service (ET&D), the gap between the commodities trajectory and a <+2.0°C temperature pathway (measured as a stock of carbon emissions) has widened from 860 bn tCO₂ to 935 bn tCO₂ by 2100, reflecting the scale of the challenge in bringing the world back onto a <+2.0°C pathway.
Sector pathways diverge sharply, but leading producers have ambitious targets
CRU's base case analysis shows that global emissions will be on a +2.5–3.0°C trajectory by 2100, but different sectors follow very different paths.
CRU covers five major emitting sectors – power, road transport, steel, cement and ammonia, together accounting for >40% of global emissions.
- Steel and road transport are forecast to be consistent with a <+3.0°C trajectory by 2050, helped by the shift from BF-BOF to EAF and H2-DRI in steel, and fast EV deployment in transport.
- Power sits just above a <+3.0°C trajectory by 2050. Rapid renewables growth is partly offset by supply variability and fast-rising electrification demand, including heat pumps, green hydrogen and AI which require continued fossil power supply.
- Cement and ammonia remain well above a +3.0°C trajectory. Despite material substitution, CCUS and green ammonia projects, our base case sees neither sector doing enough to fall below a +3.0°C trajectory, never mind meeting Paris-aligned targets.
Beyond the five major emitters, we also examine other key mining and metal sectors:
- Metallurgical coal mining, according to CRU Asset Platform data, is forecast to align with a <+2.5°C trajectory by 2040, as the shift away from BF-BOF capacity cuts demand.
- Thermal coal mining is consistent with a <+3.0°C trajectory, driven by the power sector moving away from thermal coal.
- Copper sits on a >+3.0°C path, as a larger share of output is expected to come from more emission-intensive mines.
Within each sector, CRU's methodology can also help enterprises locate their own GHG emissions pathway relative to IPCC, sectoral and peer trajectories, giving it a clear, evidence-based view of where it stands.
The two charts above benchmark individual enterprises against their sector, value chain and the IPCC trajectories. The sample copper producer sits just below the <+1.5°C pathway compared to a >+3.0°C sector pathway. Meanwhile, the sample steel producer sits on a <+2.0°C trajectory, ahead of the wider sector performance.
Warming pathways broadly track regional income level
Different countries follow different trajectories. We forecast that the EU27, the UK and Chile will align with a <+2.0°C pathway by 2050, while JKT, the USA and Australia sit on a <+2.5°C trajectory. China, Canada, Mexico and South Africa are on a <+3.0°C pathway, whereas India, Indonesia, Saudi Arabia and Brazil are forecast to align with a >+3.0°C trajectory.
We find a broad correlation between forecast cumulative emissions and wealth. Wealthier countries tend to have lower GHG emissions pathways. However, countries at similar income levels can sit on very different pathways.
The EU27 sits below the regression line, indicating a lower emissions trajectory than its income level alone would predict, and reflecting strong climate policy action in the region. On the contrary, despite high incomes, major fossil fuel producers such as the USA, Australia, Canada and parts of the Middle East sit above the line, achieving smaller reductions than peers.
Ranking well against others is not the same as being on track. We forecast that the EU27, North America, Australia and JKT will miss their 2030 and 2035 NDC targets. Note, this analysis covers the commodities sector only and assumes other sectors decarbonise at a similar pace. While further land-use measures, such as afforestation, could help close the gap, they are not a substitute for cutting emissions at source. As our carbon dioxide removal analysis presented in the chart below shows, the scale of removal needed to compensate for this would be immense.
CRU's data gives producers an independent view of where they stand and what it would take to change course
Individual commodities are either a major emitter or closely tied to one, but commodities also sit at the centre of solving the problem they help create.
CRU provides an independent, data-driven view across three dimensions:
- Where individual countries and regions stand, relative to one another and to the Paris Agreement targets;
- Where your industry stands relative to the sector average and;
- How far your carbon emissions pathway sits from a Paris-aligned trajectory.
For producers, this means having a clearer picture of the challenge. For investors, it means having the means to understand the policy direction in any given market and what it would take for a company or an industry to get on track.
Our Premium subscribers already have access to the latest update in our report here, but if you do not and want to explore the full analysis, get access to the data, or see where your sector/region sit on the relevant GHG emissions pathways, explore our CRU’s Energy Transition and Decarbonisation Service or directly contact us here.
