2025-12-31T06:32:52+00:00
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Shafaq News
Precious
metals were the standout performers among commodities this year, with silver
outperforming most major equity indexes and currencies, while gold hit record
highs on economic and geopolitical risks.
Industrial
metals also made strong gains in 2025, with copper hitting all-time highs,
though cocoa, sugar and crude oil were among the biggest losers.
Looking
ahead, precious metals have room for greater gains in 2026 as interest rates are
expected to fall, but agricultural and energy products offer little cheer as
growing supplies and tepid demand curb any upside potential, analysts say.
“Demand
for metals is looking solid from both an industrial and retail
perspective,” said Tim Waterer, chief market analyst at KCM Trade, a
global brokerage.
“The
key fundamental drivers of central bank demand and investor positioning ahead
of expected lower U.S. rates in 2026 remain intact.”
Silver
gained 161% in 2025, breaking the $80 per ounce mark for the first time, while
gold climbed 66%.
Silver has
drawn additional support from its designation as a critical U.S. mineral,
ongoing supply constraints and low inventories, while sustained central bank
buying has supported gold.
Platinum and
palladium are also on track for strong annual gains.
“We
continue to see upside in precious metals as a lot of the risks from this year
remain going into 2026,” said BNP Paribas commodities analyst Jason Ying.
Eyes on
OPEC+ in oil market
Oil
benchmarks Brent crude and U.S. West Texas Intermediate crude have fallen
around 15% this year, with Brent heading for its longest-ever stretch of annual
losses, weighed down by rising supplies.
Energy
markets have recorded losses despite supply disruptions arising from Ukraine’s
attacks on Russian energy infrastructure and U.S. measures targeting Venezuelan
oil.
The
Organization of the Petroleum Exporting Countries and its allies have paused
oil output increases for the first quarter of 2026 after releasing some 2.9
million barrels per day into the market since April 2025.
“If the
price really has a substantial fall, I would imagine you will see some cuts
(from OPEC+),” said Martijn Rats, Morgan Stanley’s global oil strategist.
“If today’s price simply prevails, after the pause in Q1, they’ll probably
continue to unwind these cuts.”
Record
copper prices and Chinese demand
Copper on
the London Metal Exchange climbed to an all-time high of $12,960 this week,
marking a near-44% gain in 2025, with a weaker U.S. dollar, growing demand from
artificial intelligence and renewable energy and mine output disruptions
fuelling the rally.
Tin made
similar gains thanks to supply disruptions in Myanmar and tightening flows from
Indonesia, while aluminium rose 17%, underpinned by China’s cap on smelting
capacity and a growth in demand from energy transition technologies.
Iron ore
traded on the Dalian Commodity Exchange has been supported by surprisingly
resilient demand despite falling crude steel output from China and a boost from
Beijing’s relaxation of homebuying in big cities. But coking coal, a
steelmaking ingredient, is in the red this year.
Beaten down
agricultural markets
Cocoa – the
biggest loser of 2025 – tumbled 48% this year, with a sharp rise a year earlier
leading to both a decline in demand for the chocolate ingredient and a boost in
supplies.
Cocoa was
one of the strongest performing commodities in 2024 with New York prices rising
178%, lifted primarily by poor crops in West Africa, a key producing region.
Raw sugar
and robusta coffee have also come under pressure, with each surrendering about
a fifth of their value in 2025.
While
Chicago soybeans are poised to end 2025 on a positive note, China’s resumption
of imports from the U.S. following a thaw in relations has erased most of the
losses incurred earlier this year when Beijing–Washington trade tensions were
higher.
Wheat and
corn are set for a weaker finish as global supplies are ample.
Benchmark
Malaysian palm oil is down 9% in 2025 on plentiful supplies but the market is
likely to find support from Indonesian biodiesel mandates.
Rubber has
given up 9% as improved weather in Thailand boosted supplies, though demand for
tyres was dismal from the automobile industry.
(Reuters)
Only the
headline is edited by Shafaq News Agency.
