Major Metals Including Guri Rally Together "Impact of Investment Demand Surge"

Prices of major metals are rising to all-time highs. The recent surge is driven by investment demand betting on a long-term increase.

Guri

According to major foreign media on the 22nd (local time), there is a broad rally in prices ranging from industrial metals such as copper, zinc, aluminum, and lead to precious metals like gold and silver.

Copper prices have risen about 30% since early March, surpassing $11,000 per ton this week. This is an all-time high. Greg Shearer, Head of Metals and Precious Metals Strategy at JP Morgan, explained, "In the case of copper, demand is increasing in the artificial intelligence (AI) sector, but supply is not easy, creating a global supply-demand inflection point," adding, "several fund monies are pouring into copper investments."

The sharp rise in copper prices has acted as a pressure factor for the price increases of other industrial metals. Zinc, aluminum, and lead have jumped 15-28% since last month. Gold also exceeded $2,450 per troy ounce, and silver surpassed $30 per ounce for the first time in 10 years.

The major price increases are interpreted as resulting from increased investments by funds aiming for long-term price rises. According to Bank of America (BoA), as of this month, 13% of global fund managers have increased their allocation to commodity investments. This is the highest level since April last year.

The net long positions (price rise expected investments) in the non-ferrous metals sector on the New York Mercantile Exchange and the London Metal Exchange reached 2.6 million tons as of mid-May, about five times the 556,000 tons at the beginning of March. This also surpassed the previous peak at the end of 2020.

Greg Shearer, the strategy head, explained, "There has been a clear inflow of funds from algorithm-driven traders, professional commodity investors, and other macro funds."

This content was produced with the assistance of AI translation services.