Commodities Tracker – December Edition

This commentary covers the key takeaways for the listed commodities. Click the (x) next to the sectors to see the respective monthly charts pack.

Marketing Communication. Capital at Risk. For Professional Investors Only.

Past performance is not a guide to future performance.

Nuclear Energy & Uranium (x)

Nuclear Policy Momentum Broadens and Plant Restarts Given the Green Light

• Japan advanced its nuclear restarts, with utilities outlining tariff reductions once reactors come online, cementing nuclear’s ongoing role in Japan’s power-mix planning.¹
• Sweden voted to lift its moratorium on uranium mining from 2026, reopening access to one of Europe’s largest undeveloped uranium resource bases and expanding long-term regional supply options.²
• The U.S. Army initiated its Janus small-reactor programme, targeting microreactor deployment on military bases by 2028 and adding another pathway for modular reactor demand and HALEU fuel requirements.³

Base Metals and Copper (x)

Copper Tightens Again as US Premium Pulls Metal West and China Cuts Processing Volumes

• Copper reached new highs in late November and early December, breaking out from range-bound trading, as a tight mining pipeline is coming back into focus.⁴
• A wide premium for Comex copper over LME prices has revived the US arbitrage trade, meaning physical supply is again rushing into US warehouses.⁵ This raises concerns of physical squeezes outside of the US.
• In China, the Copper Smelters Purchasing Team – a group of 13 major smelters – agreed to cut the amount of copper concentrate they process by more than 10% next year after treatment charges fell to negative levels, meaning smelters were effectively paying miners to take ore because unrefined copper (concentrate) has become so scarce.⁶
• Mercuria’s head of metals warned that, if current flows continue, there will be “tightness and higher prices” with Chinese buyers likely forced to pay much higher physical premiums to the US.⁷

Gold (x) & Silver (x)

Gold Holds its Gains While Silver Reclaims Highs on Tight Physical Markets

• After hitting a record above $4,380/oz in October, gold spent most of November consolidating as central-bank and investor demand stayed firm⁸; Russia’s central bank highlighted that emerging-market reserve managers are buying bullion partly to reduce exposure to sanction-prone foreign assets.⁹
• Silver is now back at all-time-highs ($57.1 on 1st December), reversing October’s drawdown.¹⁰ Growing expectations for rate cuts and ongoing physical deficits are likely dominating the short-term price action, with strong industrial demand from electronics providing structural bullishness.¹¹
• October’s extreme squeeze led to historic inflows of metal into London vaults in early November, which eased the immediate shortage but left stocks well below 2022 levels;¹² the Silver Institute now expects a fifth consecutive structural market deficit in 2025.¹³
• Deutsche Bank lifted its 2026 gold forecast to $4,450/oz (from $4,000), arguing that strong central-bank purchases and renewed ETF inflows are absorbing a large share of supply and leaving less metal available for jewellery, reinforcing a “positive structural picture.”¹⁴

Critical Minerals, Battery Tech & Lithium (x)

Rare-Earth Tensions Reset but Not Resolved; Critical Minerals Policy Accelerates in Europe

• China agreed to suspend a planned second wave of rare-earth export controls for about a year (to November 2026), easing immediate supply-disruption fears, but reinforcing that rare-earth policy will remain a strategic bargaining chip in broader US–China tensions.¹⁵
• The EU moved ahead with its “ResourceEU” strategy, which channels new funding into priority raw-materials projects and stockpiles to cut reliance on Chinese refining and exports of critical minerals, including rare earths.¹⁶
• European policy and industry voices warned that talk of a US–China “truce” risks lulling Europe into complacency, noting that actual investment and binding offtake deals for non-Chinese supply still lag the US and some allies.¹⁷

Oil (x) and Gas (x)

Oil Moves into Oversupply Territory; Europe Leans on Gas as Weather Tightens Margins

• November oil reports from the IEA and others reinforced a supply outlook, with 2026 now seen in clear surplus as non-OPEC production growth and the unwinding of OPEC+ cuts outweigh still-positive but cooling demand growth.¹⁸
• In Europe, Germany’s gas-fired power use has risen to its highest share since 2015 after weak wind and hydro output, slowing the refill of gas storage sites¹⁹; EU storage sits below last year’s record levels heading into winter, though still well above pre-crisis norms.²⁰
• Ukraine secured winter gas supplies via US LNG cargoes landed in Greece and piped north, underlining how US LNG has become a core pillar of European and allied energy security rather than an emergency back-up.²¹

This document is not intended to be, or does not constitute, investment research as defined by the Financial Conduct Authority.