Yangshan copper Premium Higher

COPPER

Copper futures held steady amid outflows of copper in LME registered warehouses, a weaker USD, and data from China. Chinese imports of unwrought copper in August fell from July to 425,000 tons but rose from a year ago, while imports of copper concentrates climbed to 2.76 million tons, a four-month high. The official NBS PMI pointed to a contraction in China’s factory activity in August, reflecting an underwhelming impact from earlier economic support by Beijing. The Chinese government removed subsidies for plants that recycle scrap copper, supporting margins for ore refiners that have struggled with negative treatment charges. The Yangshan copper premium—a gauge of demand for imported copper—rose to a three-month high, signaling stronger buying interest. China’s refined copper imports are expected to remain strong in September given the favorable import dynamics and weaker domestic production.

LME-registered copper stocks stood at 155,825 tons, with outflows of 2,125 tons across several locations and fresh cancellations of 8,500 tons in South Korea, LME daily data showed. Meanwhile, COMEX-registered warehouses in the US have continued to see inventory buildup, weighing on US futures prices.

Chile’s state-owned copper producer Codelco has warned that national copper output may stagnate around 5.5 million tonnes annually due to increasingly difficult mining conditions. Chairman Máximo Pacheco highlighted deeper mining operations, falling ore grades, and rising costs as major challenges. This production plateau could tighten global copper supply just as demand accelerates, driven by the energy transition and electrification trends.

Friday’s Commitments of Traders Report showed managed money traders were net buyers of 7,013 contracts of copper for the week ending September 2, increasing their net long to 34,651.

GOLD

Gold futures hit fresh highs again after weak payrolls data out of the US cemented expectations for a September rate cut from the Fed. Payrolls rose by just 22,000, well below expectations of 75,000 while the unemployment rate was ticked to a four-year high of 4.3%. Notably, revisions to prior months showed June was worse than initially reported (-13,000), and July slightly better (+79,000), resulting in a net downward revision of 21,000 jobs. Overall, the labor market appears to be cooling but remains stable given the unemployment rate. has opened the door for further easing from the Fed. Fed funds futures have priced in a 100% chance of a rate cut in September, and a 79% chance of an additional 25 bp rate cut at the following meeting in October. Focus now shifts to Producer Price Index data on Wednesday and the Consumer Price Index on Thursday, which could offer more clarity on the size of the Fed’s expected rate cut and expectations on the amount of easing the economy could see from the Fed this year.

Gold also continues to draw strong demand from central bank purchasing and geopolitical uncertainty regarding the situations in Ukraine and the Middle East. China’s central bank added gold to its reserves in August, extending purchases of bullion into a 10th straight month, official data showed on Sunday.

Central bank holdings of gold have topped holdings of US Treasurys for the first time since 1996. Poland’s central bank Governor Adam Glapinski plans to propose an increase in the target for gold as a percentage of reserves to 30% from 20% currently. The strong buying from central banks shows that demand has relatively not been affected by the high bullion prices. Central bank purchasing will continue to offer gold a sound floor while a reduction of the interest environment in the US will offer further support the yellow metal.

Friday’s Commitments of Traders Report showed managed money traders were net buyers of 20,740 contracts of gold for the week ending September 2, increasing their net long to 168,862.

SILVER

Silver futures are higher, reaching their highest level since August 2011, as the weak nonfarm payroll report cemented hopes of a September rate cut from the Fed. Traders now await this week’s inflation reports, with markets fully pricing in a 25 bp rate cut later this month and some betting on a larger half-point move.

On the macro-front, China’s industrial momentum remains strong, with recent data showing solar cell exports surged over 70% in the first half of the year, fueled by robust photovoltaic demand from India. This follows a record-breaking installation of more than 93 gigawatts of solar capacity in May—a 300% year-over-year increase—driven by a rush to connect panels ahead of upcoming policy changes that will tighten grid access.

On the supply side, global silver mine production has declined by 7% since 2016, contributing to an estimated shortfall of 800 million ounces between 2021 and 2025. Investor appetite remains resilient, with silver-backed exchange-traded products (ETPs) attracting net inflows of 95 million ounces in the first half of 2025. Since 2019, over 1.1 billion ounces have been withdrawn from mobile inventories.

Silver prices continue to find support from a persistent structural supply deficit and strong investor demand. Industrial usage is expanding, particularly in energy-related sectors such as solar power, electric vehicles, and electronics. Notably, solar applications accounted for 17% of total silver demand last year—triple their share from a decade ago.

For silver, managed money traders were net buyers of 6,817 contracts, increasing their net long to 41,022.

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