Guotai Haitong Securities released a research report stating that on the demand side for copper, sectors such as power, two-wheeled vehicles, and new energy maintain stable demand, with pre-Tomb Sweeping Festival stockpiling accelerating the drawdown of domestic social inventories. A favorable supply-demand dynamic continues to support copper prices. From a medium to long-term perspective, the firm maintains a positive outlook on the investment value of rare earths as a critical strategic resource. While the supply-demand balance sheet is important under tight conditions, greater attention should be paid to the core impact of macroeconomic factors on metal price trends. Monetary policy, macroeconomic expectations, geopolitical maneuvering, and supply disruptions will be decisive factors. Key views from Guotai Haitong are as follows:
Precious Metals: Prices fluctuate with strength as geopolitical tensions ease. Last week (week of April 3), expectations regarding the intensity and duration of Middle East geopolitical events shifted repeatedly, with ongoing uncertainty remaining high. Market concerns about inflation and recession initially pressured precious metal prices, but a marginal weakening in U.S. Treasury yields allowed prices to trend higher. Continued central bank gold purchases and a relatively stable U.S. dollar index support the long-term investment thesis for precious metals.
Copper: Macro pressures and supportive fundamentals create a mixed outlook, with prices moving sideways. Macroeconomic pressures persist due to volatile Middle East tensions and lingering U.S. inflation concerns. Strong U.S. non-farm payrolls adding 178,000 jobs in March, coupled with a drop in the unemployment rate to 4.3%, have dampened expectations for U.S. interest rate cuts, strengthening the dollar and temporarily pressuring copper prices. On the supply side, the CSPT did not set a second-quarter guidance price, and spot treatment charges continue to decline, indicating persistent tightness in concentrate supply and unchanged sulfuric acid price trends. The scrap copper premium/discount has been volatile, reflecting tightening scrap supply. Demand remains robust in power, two-wheeled vehicles, and new energy sectors, with holiday stockpiling accelerating inventory drawdowns. The overall supply-demand picture supports copper prices.
Aluminum: Strong upward momentum persists as overseas supply gap widens. On the supply side, EGA announced severe damage to its Al Taweelah production complex (with a 2025 capacity of 1.6 million tonnes) following an attack, leading to an emergency shutdown. A full recovery is estimated to take up to 12 months, significantly widening the overseas supply gap and providing strong upward momentum for global aluminum prices. Demand-wise, the operating rate of major domestic aluminum processors increased by 1.2 percentage points last week to 65.2%.
Tin: Prices trade in a high range amid overseas macro influences. Volatile Middle East geopolitical dynamics and shifting macroeconomic sentiment are contributing to high-level fluctuations in tin prices. On the supply-demand front, production stabilized in April following post-holiday resumptions in March, while downstream demand from solder and photovoltaic sectors remains subdued. Although order book pressure limits upside, low inventory levels provide solid price support.
Energy Metals: Steady off-season demand amid growing supply disruption risks. Lithium Carbonate: Inventories continued to build last week. Despite rising production, off-season demand remains resilient, and minor inventory accumulation is not expected to disrupt the overall supply-demand rhythm. Close attention is warranted in April regarding potential supply disruptions from Zimbabwe's export policies. Cobalt Sector: Tight raw material supply and cautious downstream purchasing are keeping prices volatile at high levels. The supply-demand deficit persists, suggesting prices will remain firm.
Rare Earths: Praseodymium-neodymium oxide prices rise. Prices for light rare earth praseodymium-neodymium oxide are gradually stabilizing and rising. However, demand for heavy rare earths dysprosium oxide and terbium oxide remains weak, with prices trending lower. The medium to long-term investment value of rare earths as a strategic resource is viewed positively.
Strategic Metals: Value becomes apparent. Tungsten: Frequent failed tenders lead to price adjustments. Prices for scheelite concentrate, APT, and powder weakened collectively due to the release of the first 2026 mining quotas and a series of failed mine tenders, fostering cautious market sentiment. Pessimism in the scrap tungsten market has eased as earlier inventories cleared. Tungsten prices are expected to trade weakly in the short term, but significant downside is limited by rigid supply constraints. Uranium: The March long-term contract price for natural uranium reached $91.50 per pound, up $1.50 from February. Persistent supply rigidity and nuclear power development sustain a uranium supply-demand gap, supporting expectations for further price increases. Tantalum: Continued accidents in the Democratic Republic of Congo's mining regions suggest short-term supply shortages will be difficult to alleviate. Tantalum concentrate prices traded at high levels last week. Growing end-demand from emerging industries like AI is expected to keep tantalum prices elevated.
Risk warnings include weaker-than-expected downstream demand, significant supply increases, and the Federal Reserve's interest rate cuts falling short of expectations.