Written Commentary
COPPER
Copper futures lost ground in the overnight session as market uncertainty surrounding US-China trade talks and the larger impact of tariffs on global economic growth and metals demand took hold.
More copper inventories departed from LME-registered warehouses as traders took advantage of higher US prices due to expectations that US President Donald Trump will impose tariffs on the metal, following duties levied on aluminum and steel. Speculation over a potential tariff on copper continues to provide upward support for the metal. In February, President Trump ordered a probe into possible new tariffs on copper imports to rebuild US production of a metal critical to electric vehicles, military hardware, and semiconductors. Copper inventories at the CME continue to break record highs as traders and producers rush to get copper in the US before an expected tariff is levied. CME copper stocks as of last Friday are at 187,877 tons, a seven thousand ton increase over last week’s reading.
Production delays at Teck Resources’ Chilean operations are expected to persist for about a month. Teck said it expects the mine, which accounts for about 10% of consolidated 2025 copper output, to produce 45,000 to 55,000 tons of the metal this year as forecast. Mining activities at the Kamoa-Kakula project in the Democratic Republic of Congo have also been interrupted, although underground mining operations on the western side of the mine are expected to resume later this month.
GOLD
Gold futures edged lower as top US and Chinese officials continued their meeting in London to discuss trade disputes and extend ongoing trade negotiations between the two countries. Tuesday’s talks are expected to continue to focus on easing tensions over rare earths and tech. Treasury Secretary Scott Bessent called Monday’s talks a “good meeting,” while Commerce Secretary Howard Lutnick called the negotiations “fruitful.”
Gold’s near-term outlook will mostly depend on the evolution of US trade policy and signals from the Fed on their path regarding monetary policy. Upcoming CPI and PPI inflation data this week will provide insights into the Fed’s future moves, as the Fed has reiterated a wait-and-see approach to monetary policy in order to cool inflation as the labor market has held firm. Markets are expecting 50 bps of easing this year from the Fed, with the first rate cut coming at the September meeting. Long-term, strong central bank and investor demand remain in favor of gold’s upside.
Central banks across the globe added a net 12 tons of gold to their reserves in April, albeit at a slower rate of accumulation than in previous months. Global central banks are on pace to purchase 1,000 metric tons of gold in 2025, marking the fourth consecutive year of substantial buying as they continue to shift reserves away from dollar-denominated assets. Several African central banks—including those of Namibia, Rwanda, Uganda, and Madagascar—have recently announced plans to either initiate or expand their gold reserves.
Global gold-backed ETFs saw an outflow of -19 tons in May, per recent data from the World Gold Council.
SILVER
Silver futures held ground in overnight trade, hovering near 13-year highs. July contracts are holding above $36.70 after breaking the $36 level on Thursday.
Silver is facing its fifth straight year of a structural supply-demand deficit, although the deficit is expected to narrow by 21% in 2025, according to the Silver Institute Industry Association. Silver is largely a by-product of the mining of other metals, meaning an increase in price will not directly drive new supply, which will maintain the deficit for longer.
The long-term outlook for silver remains positive, driven by its essential role in semiconductors, solar panels, and other clean-energy technologies, sectors that continue to attract substantial global investment. That demand has remained robust despite broad headwinds faced in the last few months as a result of tariffs. Recent data highlights this trend, with China significantly increasing its wind and solar capacity in the first quarter of 2025, while solar power generation in Europe surged 30% year-over-year during the same period.
Interested in more futures markets? Explore our Market Dashboards here.
Risk Warning: Investments in Equities, Contracts for Difference (CFDs) in any instrument, Futures, Options, Derivatives and Foreign Exchange can fluctuate in value. Investors should therefore be aware that they may not realise the initial amount invested and may incur additional liabilities. These investments may be subject to above average financial risk of loss. Investors should consider their financial circumstances, investment experience and if it is appropriate to invest. If necessary, seek independent financial advice.
ADM Investor Services International Limited, registered in England No. 2547805, is authorised and regulated by the Financial Conduct Authority [FRN 148474] and is a member of the London Stock Exchange. Registered office: 3rd Floor, The Minster Building, 21 Mincing Lane, London EC3R 7AG.
A subsidiary of Archer Daniels Midland Company.
© 2021 ADM Investor Services International Limited.
Futures and options trading involve significant risk of loss and may not be suitable for everyone. Therefore, carefully consider whether such trading is suitable for you in light of your financial condition. The information and comments contained herein is provided by ADMIS and in no way should be construed to be information provided by ADM. The author of this report did not have a financial interest in any of the contracts discussed in this report at the time the report was prepared. The information provided is designed to assist in your analysis and evaluation of the futures and options markets. However, any decisions you may make to buy, sell or hold a futures or options position on such research are entirely your own and not in any way deemed to be endorsed by or attributed to ADMIS. Copyright ADM Investor Services, Inc.
