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LONDON / NEW YORK — Industrial and precious metals are ending the year with a historic rally. International silver prices surged past the psychological barrier of $80 per ounce for the first time in history, while copper approached the $13,000 per ton mark, driven by a perfect storm of supply deficits and geopolitical maneuvering.
The "Silver Streak" Outpaces Gold
On December 29 (local time), spot silver on the London Metal Exchange (LME) hit an all-time high, marking a staggering 178% year-to-date increase. This performance significantly eclipsed gold, which, despite its own record-breaking run of 72% growth this year, retreated slightly by 0.45% to settle around $4,479.42 per ounce.
Charu Chanana, Head of FX Strategy at Saxo, attributed the rally to a combination of "interest rate cuts, hedging against geopolitical and fiscal uncertainties, and acute supply shortages." However, Chanana warned that such a vertical price spike increases the risk of high volatility and technical corrections in the short term.
Copper Rallies on "Tariff Front-Running"
The copper market saw even more dramatic intraday action. LME copper spot prices briefly spiked 6.6% to nearly $12,900 per ton immediately after the market opened. Analysts point to a "hoarding effect" as a primary driver; investors and manufacturers are aggressively securing stockpiles ahead of potential U.S. import tariffs.
The Trump administration is expected to decide on refined copper tariffs by mid-2026, leading to a massive diversion of supply toward U.S. warehouses. This shift has tightened global availability, pushing LME prices to their best performance since 2009.
Market Divergence and Risks
Despite the bullish momentum, there are growing signs of "demand destruction" in major consuming markets. In China, the world’s largest copper consumer, some processing plants have reportedly scaled back or halted production, unable to absorb the record-high costs.
"The gap between speculative pricing and actual industrial consumption is widening," noted Wu Kunjin, head of non-ferrous research at Minmetals Futures.
While technical risks persist, the overarching sentiment remains positive for 2026. Experts believe that ongoing fiscal instability and the structural shift toward electrification—which requires massive amounts of copper and silver—will continue to treat any significant price dips as "buying opportunities" for long-term investors.
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