Renewables/GOES MMI: Slowing Economy Could Impact Renewable Energy Companies’ Projects


The Renewables MMI (Monthly Metals Index) dropped by 3.65% between March and April. This represents the index’s most significant drop since November 2022. Despite this, the index still has yet to break out of its sideways trend. However, the falling economy continues to keep both renewable energy companies and investors on edge.

The Inflation Reduction Act currently supports the index, particularly electric vehicles. However, renewable resources could start feeling the strain with the economy slowing down and spending decreasing. For now, no massive fluctuations have occurred in the index due to the state of the economy. However, that could change soon.  


The steel plate parts of the index held strong, with most actually increasing in price. However, steel prices could soon hit their peak, so the continuation of this trend remain uncertain. Meanwhile, two main components caused the index to drop: silicon and neodymium. The silicon market still finds itself oversupplied, and prices are not finding much upward support. And after hitting historically high levels in early 2022 (like numerous metals did), neodymium continues its downward trend.

For the immediate future, all eyes are on the state of the U.S. economy. Indeed, it could have the largest immediate impact on the production of renewable resources.

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Effects of Recessions on Renewable Energy Companies

During a recession, there may be a reduction in demand for renewable resources as both consumers and businesses tighten their budgets. Renewable resources such as solar and wind power cost more on average to construct than other forms of energy, such as those driven by natural gas. This could result in decreased investments in renewable energy projects all around. Ultimately, this would lead to a slowdown in renewable energy production, creating significant problems for renewable energy companies and investors.

A recession could also impact supply chains for renewable resource materials, including the manufacturing of products like solar panels and wind turbines. These disruptions could result in production costs and delays, further impacting renewable resource pricing and manufacturing.

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This would be an especially hard blow after China’s slower-than-anticipated COVID-19 recovery at the beginning of the year. Indeed, resources like rare earths, cobalt, and other raw materials sourced from China are still recovering from slowed domestic demand. The only exception seems to be silicon due to the marketing being over-supplied.

Concerns Over Possible Cuts in Government Funding

If a large economic downturn does happen, there may be a drop in government subsidies for renewable resources, as governments prioritize other areas of the economy. Currently, the Inflation Reduction Act is still holding renewable energy resources afloat, even in the face of a recession. Despite this, a recession could still result in decreased support for renewable resource companies and their projects.

Despite these negative impacts, a recession can also positively affect renewable resource prices. For example, during an economic downturn, there may be a decrease in the prices of raw materials and commodities. This includes renewable resource building materials like steel, aluminum, and cobalt. Ultimately, this could lead to an influx in production as materials become cheaper.

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The Grain-Oriented Electrical Steel MMI traded flat between March 1 and April 1.

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GOES has managed to hold a sideways trend since November. In fact, January was the only month the index made any significant movement (in this case, down). However, by mid-March, European GOES <600mm prices began moving upward slightly. Despite this, neither European nor U.S. GOES indices have broken out of a sideways trend. Renewable energy companies continue to follow GOES prices closely, especially with the ongoing issue of transformer shortages.

Transformers Still in Short Supply. Renewable Energy Companies Feeling the Stress

MetalMiner has touched on the ongoing transformer shortage in the U.S. before. Unfortunately, the nation is still struggling with a severe lack of transformers. Indeed, the shortage continues to cause delays in constructing new power grids and replacing parts of old ones. It is also hindering the construction of power sources to charging stations for electric vehicles. Given the huge influx in EV initiatives, this presents a massive problem. It also means that power grids dependent on fossil fuels cannot expand either, or deliver power to growing areas that badly need it. Some even speculate that the delays could last years.


Investing in new transformer manufacturing facilities or increasing the number of transformers imported from other countries could provide relief. However, the process has been slow. In order to meet current zero-carbon emission goals, the U.S. must vastly increase its grid’s capability to transfer power from expanding solar and wind fields. To make matters worse, many transformers across the U.S. are coming close to the end of their lifecycle. This places a severe strain on renewable energy companies.

Supply Chain Disruptions Still a Problem


COVID-19 hit all supply chains hard, and transformers, as well as materials to construct transformers like GOES, were no exception. These supply chain disruptions have extended years past the beginning of the pandemic. Moreover, a slew of severe weather patterns has battered power grids in certain parts of the U.S. Hurricane Ian, for instance, ruthlessly slammed Southern Florida in 2022, leaving many power grids across the region in shambles. Just this year, the South and the Midwest have found themselves in the midst of several huge weather systems, resulting in multiple tornadoes. Arkansas, Iowa, Mississippi, and Illinois are just a few places impacted by these storms, which left countless grids damaged.

Ultimately, the issue of transformer shortages is getting worse as opposed to better. If more options don’t present themselves, the problem could get out of hand.

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Renewables/GOES MMI: Notable Price Trends

  • US GOES coil traded flat, remaining at $4741.00 month-over-month.
  • Chinese cobalt cathodes held sideways, rising in price a modest 2.66%. Prices sat at $40,002.91 per metric ton at month’s start.
  • Korean steel plate traded sideways, inching up 1.84%. Prices sat at $918.93 per metric ton at month’s start.
  • Lastly, Chinese silicon saw yet another heavy decrease in price, this time by 7.15%. Prices hit $2326.60 per metric ton.

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