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Commodity Prices See Volatility in First Quarter Amid Tariff Concerns
(MENAFN) Commodity markets experienced notable volatility in the first quarter, driven by tariff concerns and ongoing global economic uncertainty. Key commodities like gold, silver, copper, and coffee saw sharp price increases.
U.S. President Donald Trump’s tariffs intensified fears of deepening trade wars, while improvements in China’s industrial activity influenced commodity prices. Analysts highlight China's domestic demand weakness as a key risk to its economy, compounded by rising debt from local governments and a slowing real estate sector.
China’s exports slowed during the first two months of the year, largely due to Washington's tariffs. However, Beijing’s efforts to encourage personal consumption loans provided some support to the commodity market. Positive economic data from China helped mitigate concerns about weakening demand, despite escalating trade tensions.
China’s restrictions on U.S. agricultural imports have pressured grain prices, while global demand concerns continued to impact Brent crude oil. Experts warn that trade protectionism and a decline in globalization could fuel inflationary pressures and drive long-term demand for industrial metals, energy, and agricultural products.
Gold prices surged 19.1% per ounce in Q1, benefitting from its role as a safe-haven asset amid economic growth concerns. Palladium and platinum also rose by 10.2% and 8.2%, respectively, driven by Trump’s actions regarding the U.S. auto industry, while silver increased by 10.2%.
Copper prices jumped 26% per pound, reaching a record $5.33, boosted by China’s industrial recovery and stimulus measures. However, a 25% U.S. tariff on copper also contributed to the rise.
Lead and nickel rose by 3.2% and 3.6% per pound, respectively, while aluminum fell 0.8% and zinc dropped 4.5%.
Brent crude oil saw a slight decrease of 0.2% per barrel after OPEC+ unveiled plans to increase production, and the International Energy Agency forecast a 600,000-barrel surplus this year. Meanwhile, natural gas prices dropped 13.4% per MMBtu in the first quarter.
U.S. President Donald Trump’s tariffs intensified fears of deepening trade wars, while improvements in China’s industrial activity influenced commodity prices. Analysts highlight China's domestic demand weakness as a key risk to its economy, compounded by rising debt from local governments and a slowing real estate sector.
China’s exports slowed during the first two months of the year, largely due to Washington's tariffs. However, Beijing’s efforts to encourage personal consumption loans provided some support to the commodity market. Positive economic data from China helped mitigate concerns about weakening demand, despite escalating trade tensions.
China’s restrictions on U.S. agricultural imports have pressured grain prices, while global demand concerns continued to impact Brent crude oil. Experts warn that trade protectionism and a decline in globalization could fuel inflationary pressures and drive long-term demand for industrial metals, energy, and agricultural products.
Gold prices surged 19.1% per ounce in Q1, benefitting from its role as a safe-haven asset amid economic growth concerns. Palladium and platinum also rose by 10.2% and 8.2%, respectively, driven by Trump’s actions regarding the U.S. auto industry, while silver increased by 10.2%.
Copper prices jumped 26% per pound, reaching a record $5.33, boosted by China’s industrial recovery and stimulus measures. However, a 25% U.S. tariff on copper also contributed to the rise.
Lead and nickel rose by 3.2% and 3.6% per pound, respectively, while aluminum fell 0.8% and zinc dropped 4.5%.
Brent crude oil saw a slight decrease of 0.2% per barrel after OPEC+ unveiled plans to increase production, and the International Energy Agency forecast a 600,000-barrel surplus this year. Meanwhile, natural gas prices dropped 13.4% per MMBtu in the first quarter.
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