Metals Rise as Supply Risks Support Prices

Tashkent, Uzbekistan (UzDaily.uz) — Industrial and precious metals traded mixed over the past week amid shifts in commodity markets, geopolitical developments and expectations for US monetary policy, according to Alpari analyst Anna Bodrova.

Bodrova said copper futures moved into consolidation after rising by more than 3%. The market was supported by signs of tightening supply in China, where the premium for imported copper rose to US$100 per tonne, its highest level since May last year.

The analyst attributed the increase to Chinese authorities' measures to combat value-added tax fraud, which reduced the availability of copper scrap and increased demand for imported refined copper. At the same time, copper inventories at the London Metal Exchange (LME) fell to their lowest level since March.

Aluminium continued to recover after falling to a four-month low in early July. Bodrova said prices were supported by supply disruption risks and declining inventories.

She noted that continued tensions in the Middle East have reduced the likelihood of a recovery in aluminium supplies from Gulf countries, which account for around 9% of global supply.

Meanwhile, aluminium inventories at the LME remain at their lowest level since 2022, while stocks on the Shanghai Futures Exchange continue to decline.

In the precious metals market, palladium was trading at around US$1,260 per troy ounce. Bodrova said higher US Treasury yields and expectations of further interest rate increases by the US Federal Reserve were weighing on prices. She added that high production costs for South African producers continued to constrain supply. According to the analyst, palladium prices have fallen 22.81% since the beginning of the year.

Platinum, by contrast, rose to US$1,670 per ounce, reaching its highest level in four months. Bodrova said the market was supported by recovering demand for precious metals and a continuing supply deficit.

Silver held near US$59 per ounce after gaining about 4% previously. Investors continue to assess the impact of developments in the Middle East and higher oil prices on inflation and the outlook for interest rates.

Gold rose to US$4,100 per troy ounce after increasing by nearly 2% in the previous trading session, according to the analyst.

Bodrova said demand for safe-haven assets amid continued uncertainty in global markets continued to support gold prices.