Summary:
In February 2025, the global metals market faced volatility due to U.S. tariffs, geopolitical tensions, and supply chain shifts. Steel and aluminum tariffs drove stockpiling and equity gains, while gold hit record highs. Copper markets reacted to potential tariffs, zinc saw price declines, and nickel remained under pressure from oversupply. Key developments in March, including trade retaliations and industry summits, will shape market trends.
Inside this edition:
- Key Updates in the Steel and Aluminum Industry
- Key Updates in the Global Copper Market
- Global Zinc Market Update
- Global Nickel Market Update
- Metalmetre Analysis: Expert Technical Analysis and Market Insights
- Close Monitoring in March
- Industry Conferences and Summits in March 2025
1.Key Updates in the Steel and Aluminum Industry
In February 2025, geopolitical developments, environmental concerns, and evolving regulatory frameworks significantly influenced the global metals market. A pivotal event was the U.S. President Trump’s announcement of a 25% on steel and aluminum imports, aimed at strengthening domestic production. This policy shift triggered a rally in U.S. steelmaker equities while simultaneously driving gold prices to record highs as investors sought safe-haven assets amid heightened economic uncertainty.
The anticipated tariffs spurred a surge in metals demand, with aluminum imports notably increasing ahead of the implementation deadline. This pre-tariff stockpiling led to a sharp rise in premiums above London Metal Exchange (LME) prices, which climbed to levels not seen since mid-2024. The combination of policy-driven market shifts and speculative positioning underscored the sensitivity of the metals sector to macroeconomic and trade policy developments.
Market Reactions:
- Equity Performance: U.S. steelmakers experienced a notable uptick in stock prices following the tariff announcement. U.S. Steel surged by 4.8%, while Alcoa gained 2.2%, reflecting investor optimism about the policy’s potential benefits for domestic producers.
- Safe-Haven Demand: Gold prices soared to a record high, surpassing $2,900 per ounce, as market participants sought stability amid heightened economic and trade uncertainties. The strong demand for gold underscores investor concerns over the broader implications of protectionist trade policies.
- Increased Metals Demand: Anticipation of the tariffs prompted a surge in U.S. aluminum imports, as traders sought to secure supply ahead of the policy’s implementation. January imports exceeded 580,000 tonnes, marking a 25% increase compared to the five-year January average, highlighting the urgency among market participants to hedge against potential supply disruptions.
- Price Volatility: Premiums for metals surged above London Metal Exchange (LME) benchmarks, with LME aluminum prices surpassing $2,700 per tonne, the highest level since mid-2024. The price escalation reflects both short-term speculative activity and concerns over long-term supply constraints.
- Trade Relations & Supply Chain Disruptions: The imposition of tariffs has introduced additional strain on trade relations, particularly with Canada and Mexico, two of the largest suppliers of steel and aluminum to the U.S. The disruption is forcing adjustments in global supply chains, with potential renegotiations of trade agreements and shifts in sourcing strategies as businesses seek to mitigate the impact of higher costs and trade barriers.
Market Dynamics and Price Fluctuations:
- Aluminum Market Outlook: Analysts forecast aluminum to be the top-performing base metal in 2025, with prices expected to increase by 6.3% to $2,730 per metric ton. This upward trajectory is primarily driven by anticipated supply constraints, as global production struggles to keep pace with rising demand. Supply-side pressures, including regulatory restrictions and geopolitical disruptions, are expected to further tighten market conditions, supporting elevated price levels.
- Gold Price Surge: Gold prices have reached record highs, climbing to $2,956 per ounce, driven by escalating U.S.-China trade tensions and broader geopolitical uncertainties. The sustained rally reflects heightened investor demand for safe-haven assets amid increasing economic and financial market volatility. The trend underscores gold’s role as a hedge against uncertainty, with further upside potential should geopolitical risks persist or intensify.
2. Key Updates in the Global Copper Market
U.S. Tariff Investigations and Market Reactions
President Donald Trump has directed the Commerce Department to evaluate the feasibility of imposing tariffs on copper imports, aiming to strengthen domestic production and reduce dependence on foreign supply. This initiative aligns with broader national security objectives, particularly in sectors critical to electric vehicles, military applications, and consumer electronics.
Following the announcement, market participants reacted swiftly, with COMEX copper futures rising by 1.9% to $4.612 per pound. Major mining stocks, including Freeport-McMoRan, saw gains exceeding 4%, reflecting investor expectations of tighter supply conditions and potential benefits for domestic producers.
Financial institutions are closely monitoring the potential economic and market implications of these tariffs. Citi projects that a 25% copper-specific tariff could be implemented by Q4 2025, likely prompting U.S. buyers to increase stockpiling activity, thereby pushing prices higher in anticipation of the policy shift. Meanwhile, Goldman Sachs analysts assign a 50% probability to a 10% U.S. tariff on copper by the end of Q1 2025, underscoring the uncertainty surrounding trade policy developments and their potential market impact.
International Responses and Supply Chain Implications
Chile, the world’s largest copper producer and a key supplier to the U.S., is closely monitoring the ongoing U.S. investigation into potential copper tariffs. The Chilean government has voiced concerns regarding the potential ramifications for its mining sector and bilateral trade relations, highlighting the risk of market disruptions should tariffs be implemented. Any restrictions on U.S. imports could prompt Chilean producers to seek alternative markets, potentially reshaping global copper trade flows.
Meanwhile, China continues to reinforce its position in the global copper supply chain through strategic investments in the Democratic Republic of Congo (DRC). In 2024, copper shipments from the DRC to China surged by 71% to 1.48 million metric tons, reflecting China’s efforts to secure long-term supply amid ongoing market volatility. This trend underscores China’s strategic approach to resource acquisition, reducing dependence on traditional suppliers while bolstering its influence in the global copper market.
Market Outlook
The potential imposition of U.S. tariffs on copper imports is expected to introduce both opportunities and challenges within the global copper market. While the policy aims to incentivize domestic production, analysts caution that higher input costs could negatively impact U.S. industries heavily reliant on copper, including the automotive, electronics, and defense sectors. This could lead to reduced consumption and increased substitution with alternative materials such as aluminum, particularly in applications where cost efficiency is a priority.
Moreover, the introduction of tariffs could disrupt established international supply chains, prompting adjustments in global trade flows. Major copper-exporting nations may seek to diversify their markets, potentially strengthening trade partnerships outside the U.S. The resulting shifts could reshape the competitive landscape, with long-term implications for both producers and consumers across the global metals sector.
3. Global Zinc Market Update
Market Dynamics and Price Movements
Price Trends:
In January 2025, zinc prices exhibited a significant downward trend. The most actively traded Shanghai Futures Exchange (SHFE) zinc contract closed at 23,655 yuan per metric ton on January 27, reflecting a 7.09% decline from the start of the month. Prices reached a peak of 25,305 yuan per metric ton in early January before declining to a low of 23,470 yuan per metric ton by the end of the month. This downturn is attributed to a combination of macroeconomic factors, subdued demand expectations, and fluctuations in raw material supply.
Inventory Control:
As of February 20, 2025, a single market participant has acquired control of up to 90% of available zinc inventories on the London Metal Exchange (LME), amounting to an estimated $370 million in value. While this concentration has raised concerns regarding potential supply constraints, no immediate shortages have been observed in the physical market. However, the development warrants close monitoring, given its potential to impact liquidity and price volatility in the near term.
Industry Developments and Corporate Strategies
Boliden’s Strategic Acquisition:
Swedish mining giant Boliden has entered an agreement to acquire the Neves-Corvo mine in Portugal and the Zinkgruvan mine in Sweden from Lundin Mining, in a deal valued at up to $1.45 billion. This acquisition is expected to strengthen Boliden’s zinc and copper production portfolio, reinforcing its position in the European base metals market. The move aligns with the company’s broader strategy to secure high-quality assets and expand its operational footprint.
Korea Zinc’s Market Expansion:
In response to China’s export restrictions on antimony, Korea Zinc has initiated preliminary discussions with U.S. buyers to supply the critical mineral. This strategic shift underscores Korea Zinc’s proactive approach to diversifying its market reach while mitigating geopolitical and trade-related supply disruptions. The company’s engagement with U.S. counterparts signals a potential reshaping of supply chains in the specialty metals segment.
Exchange and Regulatory Developments
London Metal Exchange (LME) Expansion:
The LME has approved Hong Kong as a new warehouse location, a move designed to enhance the exchange’s access to mainland China—one of the world’s largest consumers of industrial metals. The expansion is expected to broaden warehousing capabilities and improve logistical efficiencies, reinforcing the LME’s role as a key facilitator of global metals trade. The decision reflects ongoing efforts to optimize inventory management and meet evolving market demands.
4. Global Nickel Market Update
Market Overview and Price Trends
The global nickel market is undergoing a period of adjustment, driven by a combination of supply-side expansions, corporate restructuring, and geopolitical developments. Nickel prices have continued their downward trajectory, reaching a four-year low below $16,000 per metric ton. This price decline is primarily attributed to an oversupply from Indonesia, which has significantly ramped up production. The London Metal Exchange (LME) recently reported a price of approximately $15,568 per metric ton, reflecting the ongoing surplus in global supply.
Indonesia’s Expanding Market Influence
Indonesia has emerged as the dominant player in the refined nickel market, accounting for 61% of global supply in 2024—up from just 6% in 2015. This rapid expansion is a direct result of government policies, including the ban on raw nickel exports since 2014, which has incentivized foreign direct investment, particularly from Chinese firms. The influx of capital has facilitated the development of large-scale processing facilities, further solidifying Indonesia’s strategic importance in the sector.
Strategic Corporate Transactions
Amid shifting market conditions, corporate realignments continue to reshape the industry. Anglo American has announced the sale of its Brazilian nickel assets to China’s MMG Ltd in a deal valued at up to $500 million. The transaction includes two operational ferronickel plants along with two greenfield projects. This divestment aligns with Anglo American’s strategy to streamline its asset portfolio and focus on core business areas, while MMG seeks to expand its footprint in the nickel market and diversify its metal production capabilities.
Impact of Sanctions on Russian Nickel Producers
Western sanctions have weighed heavily on Russian nickel producer Nornickel, which reported a 37% year-on-year decline in net profit for 2024, totaling $1.8 billion. The company has faced significant operational challenges, including restricted access to critical equipment, complications in financial transactions, and declining demand from Western markets. As a result, Nornickel has intensified efforts to strengthen its presence in Asian markets, shifting exports to countries less affected by the sanctions regime.
Market Outlook and Price Forecast
Despite current price weakness, analysts suggest the nickel market may be approaching a turning point. The combination of sustained demand from the stainless steel sector and a gradual reduction in ore supply surpluses is expected to provide some price support. According to Macquarie, LME cash nickel prices are projected to recover to $20,500 per metric ton by the end of 2025, with further appreciation anticipated, reaching $23,000 per metric ton by 2028.
In summary, the global nickel market remains in flux, shaped by Indonesia’s increasing supply dominance, corporate restructuring efforts, and geopolitical disruptions. While near-term price pressures persist, long-term fundamentals point to a potential stabilization and recovery, contingent on demand resilience and supply-side adjustments.
5.Metalmetre Analysis: Expert Technical Analysis and Market Insights
COPPER
In February, LME Copper futures experienced a sharp rally driven by U.S. President Donald Trump’s tariff threats, leaving behind a bullish monthly candle. Due to potential tariff threats on copper imports, the spread between LME Copper Futures and COMEX Futures exceeded $1,000 during this period. In the last week of February, Copper Futures, consolidating after its strong monthly surge, is likely to test the liquidity zones left above in the $9,600 – $9,700 range as long as it remains above the 50-day moving average of $9,564. The levels to watch during pullbacks will be in the 9,245–9,310 range.
ALUMINUM
Due to tariff threats, LME Aluminum futures saw sharp gains in February but ended the last week of the month with steep pullbacks. After testing the $2,736 level during Trump’s tariff rally, aluminum futures are now trading around $2,610. The market initially priced in the tariff threats as bullish but seems to have sold off once the tariffs were officially implemented. However, from a technical perspective, the outlook remains bullish as it is still trading above key daily and weekly moving averages. As long as it continues to close above $2,600 on a daily basis, it is likely to retest the $2,700 level.
ZINC
After reaching its peak levels in October 2024, LME Zinc futures remain in a downtrend and failed to form a new higher high during the February rally, keeping the market structure unchanged. However, technically, the recent pullback in the last week raises the possibility of a new lower low. If zinc futures move above $2,940, the market structure would shift, signaling a bullish outlook, but key resistance from the 50-, 100-, and 200-day moving averages will pose challenges. We maintain a cautious stance unless the price establishes stability above the $3,000 level.
NICKEL
After the 2022 LME Nickel crisis, LME Nickel futures have struggled to recover, making technical analysis quite challenging. Since August 2024, prices have been moving within a narrow range with minor fluctuations. Once considered the most critical metal for battery production, nickel’s usage has significantly declined with the rise of iron-based cathodes. Additionally, last week’s news from Indonesia about a 30% increase in nickel production has further fueled expectations of oversupply in the market. Closures below $15,840 could push prices down toward the $15,500 level. On the other hand, if the price closes above $15,840, the key levels to watch on the upside will be $16,150 and $16,495.
6.Close Monitoring in March
As of February 27, 2025, key developments in the metal industry demand close monitoring in March:
Policy Changes and Market Implications:
- Copper Tariff Review: The U.S. probes copper imports, signaling a possible 25% tariff by Q4 2025, targeting supply security for EVs and defense, but adding market uncertainty.
U.S. Tariffs on Steel & Aluminum: A 25% tariff on imports, effective March 12, aims to boost domestic production but raises concerns over rising costs and potential trade retaliation. - Global Trade Tensions: U.S. tariffs trigger responses—Vietnam to impose up to 27.83% duties on Chinese steel (March 7), South Korea considers 38%, and India weighs 15–25% duties to curb cheap imports.
Market players should prepare for price volatility and shifting trade flows.
7.Industry Conferences and Summits in March 2025
European Green Steel Summit 2025
Taking place from March 12-13 in Düsseldorf, Germany, this summit will explore the challenges and opportunities in transitioning to green steel production.
International Conference on Sustainable Cokemaking and Ironmaking
Scheduled for March 16-18 in Newcastle, Australia, this conference aims to foster collaboration and identify future research opportunities in sustainable steelmaking practices.
LBMA Assaying & Refining Conference 2025
The London Bullion Market Association (LBMA) will host its Assaying & Refining Conference from March 16 to 19, 2025, in London. This event gathers experts to discuss advancements and challenges in the precious metals industry.
EUROMETAL Steel Net Forum Iberia
Set for March 20-21 in Vilamoura, Portugal, this forum will bring together industry professionals to discuss developments in the Iberian steel market.
3rd European Green Steel Summit 2025
Set for March 25-26 in Düsseldorf, Germany, this event will delve into the critical challenges and opportunities surrounding the transition to green steel production.
Global Trade 2025 Conference
On March 27, 2025, London Metal Exchange (LME) CEO Matthew Chamberlain is scheduled to speak on the “Securing the Critical Materials Supply Chain” panel at the Global Trade 2025 conference in London.