Metals Daily

This MorningLead gained almost 1.5% on this Wednesday morning. Tin and zinc both went up by 1%. Copper, aluminium and nickel all lifted just a bit. What's Moving Markets?Global equities were pressured by the risk of escalation of geopolitical concerns while a batch of hard economic data reflected a growing negative impact from uncertainty of economic policy. Industrial production in the US fell 0.2% in May 2025, missing market expectations of a 0.1% rise and after increasing 0.1% in Apr. Risk sentiment in global markets was hampered by President Trump signalling escalation against Israel by downplaying a ceasefire deal and warning Tehran residents to evacuate. Israel continued to bombard Iran, which fired missiles and drones in retaliation. Donald Trump “may decide he needs to take further action” to stop Tehran enriching uranium, vice-president JD Vance said, just before the US president called for Iran’s “unconditional surrender.” Oil prices fall and stocks gain on news Iran is seeking de-escalation, despite strikes continuing. Base metals edged higher as inventories continue to fall. Yields on 10-year US Treasuries fell by 5bp to 4.41%, while the USD index was 0.7% stronger at 98.7.G7 leaders have agreed a new, draft strategy to secure global supply chains for critical minerals in response to China’s growing use of export restrictions, according to a draft communique. Importantly, the draft suggests the mineral market should reflect the real costs of responsible extraction, processing, and trade of critical minerals. “We have shared national and economic security interests, which depend on access to resilient critical minerals supply chains governed by market principles. Non-market policies and practices in the critical minerals sector threaten our ability to acquire many critical minerals, including the rare earth elements needed for magnets, that are vital for industrial production.” The move comes after China enforced export restrictions on a range of critical minerals in response — from rare earths to antimony, gallium to tungsten — to US tariffs and sanctions. The West wants to secure critical mineral supply chains — not with massive state subsidies, significant to China — but with market forces. One of the solutions suggested is bifurcation, a premium on critical minerals produced in the West with expensive environmental regulation. But will consumers pay an environmental premium?Gold and silver consolidated, while the PGMs rallied on better risk appetite. Last week global gold ETFs saw their largest weekly net inflows ($2bn, 22t) since Apr. All regions contributed positively to the global picture, with North American funds seeing the largest demand. The World Gold Council released the 2025 Central Bank Gold Reserves Survey. 43% of respondents say their institution has plans to increase their gold holdings in the coming 12 months, while 95% believe that central banks overall will increase total gold reserves, both record highs. Silver broke above $37 to reach a fresh 13-year high, and with gold showing increased signs of fatigue, the gold:silver ratio is falling, currently at 91.3, down from an April peak above 105, but well above the five-year average near 80.Base metals ended lower on renewed geopolitical tensions as Vance says Trump ‘may’ take further action to end Iran’s nuclear enrichment. Cochilco reported Chilean mine copper production at 461kt for Apr — down 2.7% from Mar but up 13.6% YoY. It was also the best Apr output since 2021. YTD, Chile’s copper mine production has increased by 61kt (+3.6%) compared to the same period in 2024. This growth is primarily driven by a 77kt increase at Escondida, supported by higher ore grades; a 25kt rise from Codelco, as Salvador ramps-up and other operations like Radomiro Tomic report better results compared to 2024; and - a 23kt boost from Capstone’s Mantoverde ramp-up.Iron ore prices remain weak, as concerns over demand weighed on sentiment. Data showed China’s steel production fell 6.9% in May. This is its first contraction since Beijing vowed to address a glut in Mar.