Metal Industry: Supply and Demand Dynamics and Price Trends

On the chessboard of economic development, the metal industry has always held a pivotal position. From the basic materials for industrial manufacturing to the key elements in the high-tech field, the presence of metals is everywhere. Recently, the metal industry has presented a complex yet promising situation.
From the perspective of market performance, the period from the first half of 2025 was undoubtedly a "glorious moment" for the non-ferrous metals industry. Commodity prices generally rose, like a strong wind, driving a significant increase in industry profits. As of August 29th evening, the disclosed half-year reports of listed companies in the non-ferrous metals sector were impressive, with over 60% of enterprises reporting year-on-year growth in profits, and 90% achieving net profit for the parent company. Among them, companies with profits exceeding 1 billion yuan reached as many as 21. Like Zijin Mining, in the first half of the year, the revenue was 167.711 billion yuan, increasing by 11.5%, and the parent company's net profit was as high as 23.292 billion yuan, increasing by 54.41%, firmly holding the position of "profit king" in the industry. Behind this achievement, the significant increase in gold prices (with an increase of 27% in the first half and 26 times breaking historical highs) and the "V-shaped" rebound of copper prices due to the demand for new energy and the new round of electrification, with the domestic copper apparent demand growth rate exceeding 10% in the first half, demonstrated strong demand resilience.
Looking at the trend of metal prices, taking September 1st as an example, the international gold price was like a runaway horse, opening high and closing high, and at one point broke through 3,557 US dollars/ounce, once again refreshing the historical high. The domestic Shanghai Gold main contract 2510 also did not want to be outdone, breaking through 800 yuan/gram during the trading session. The silver futures price also performed well, with COMEX silver reaching a peak of 41.640 US dollars/ounce, setting a new historical high. Industry experts generally believe that the US July inflation data strengthened the expectation of the Fed to cut interest rates next month, becoming an important driving force for the rise in gold and silver prices. In addition, silver has been continuously deepening its application in photovoltaics, new energy, and electronic power, with the proportion of industrial demand exceeding 55%, and the supply-demand gap has persisted for 5 years, adding impetus to its price increase.
In the industrial non-ferrous metals sector, copper and aluminum, among others, have each had their own fluctuations in the sub-markets. In the case of copper, the world's largest copper mine supplier, Chile, lowered its 2025 copper production growth expectation to 1.5% and projected a production of 5.58 million tons. Copper production in Zambia in the second quarter also declined. Although it is in the copper demand off-season at present, in the long term, the green energy transition, electrification, and artificial intelligence will significantly boost copper demand, and the supply-side constraints have made the resource attributes of copper more prominent. However, the US imposing tariffs on the copper产业链 has, although overall manageable, still brought certain interference to the market in the short term. The supply of aluminum presents a rigid characteristic, with the oxidation rate of alumina increasing, the industry stabilizing market prices through policies and other means, and the alumina futures remaining stable at 3,200 yuan/ton. Although the domestic electrolytic aluminum market is in the period of accumulation and inventory (the latest inventory is 590,000 tons, increasing by 24,000 tons compared with the previous period), it is expected that as the downstream emerges from the off-season, the inventory will stop at the historical low level (65 - 70,000 tons). In the second half, the supply and demand of electrolytic aluminum will maintain a tight balance, and industry profits are expected to remain at a high level.
From the perspective of the industrial chain, since August 1st, when the US imposed a 50% tariff on semi-finished copper and copper-intensive derivative products, the global copper market has been tumultuous. US domestic copper processing enterprises have been impacted, the cost of importing raw materials for processing and re-exporting has significantly increased, some enterprises consider capacity transfer, and at the same time, the domestic internal sales restrictions on scrap copper have further compressed the flexibility of raw material acquisition for processing enterprises, resulting in high copper inventories and pressure for inventory outflow. As the global center for copper processing and consumption, China saw an "rush for installation" of new energy projects in the first half of the year, which overburdened some of the demand. Coupled with the impact of the US tariff policy, the market is concerned about the downward trend of copper prices. However, in the long term, the tight supply of copper resources has not changed. For instance, the Chilean state copper company lowered its production guidance, and the global competition for copper resources intensified. Copper prices are still supported by the supply from the mining sector. In the aluminum market, the US did not impose tariffs on refined aluminum, but domestic aluminum processing enterprises saw their product prices rise due to cost pressure. Domestic aluminum ingot inventory continued to increase but was not smooth. The price of aluminum on the Shanghai Futures Exchange fluctuated around 20,700 yuan per ton. Short-term demand expectations are weak, but in the medium term, supported by low inventory and policy expectations, the downward space is limited. The alumina market continues to maintain an oversupply pattern. Although there is a disturbance in bauxite supply, the import of ore has alleviated the tight situation.
Looking ahead to the second half of the year, the industry remains confident about the price trends of gold and copper. Zijin Mining believes that the resilience of China's new energy transformation and infrastructure investment demand persists, coupled with the long-term structural supply gap of refined copper, the fundamental support for copper prices is solid; global trade uncertainties, geopolitical tensions, and the weak dollar trend will strengthen the market's demand for gold allocation, and the demand for gold purchases by central banks remains high. The price of gold is expected to continue a high-oscillation trend in the second half of the year.
In this field of the metal industry, which is full of opportunities and challenges, whether investors, practitioners, or those concerned about economic development, all need to closely monitor industry dynamics, grasp the market pulse, and be able to find the right direction in the complex and changing market.