Daily metals

Copper is trading at $13,243 cash as of Monday morning, down 0.3% from Friday's official close of $13,282, as the renewed closure of the Strait of Hormuz weighs on risk appetite. Nickel is the standout gainer, up 0.9% at $18,072, while tin is the biggest decliner, falling 0.9% to $50,014. Aluminium is essentially flat at $3,570 (+0.1%), zinc is unchanged at $3,442, and lead has edged up 0.3% to $1,950. The complex is caught between supportive Chinese demand fundamentals and a sharp deterioration in Middle East ceasefire prospects that has sent Brent crude surging above $95.

The fragile U.S.-Iran ceasefire is unravelling. Washington seized an Iranian cargo ship attempting to run its blockade, prompting Tehran to vow retaliation and reject a second round of peace talks before the truce expires on Tuesday. Iran has reimposed its de facto closure of the Strait of Hormuz, sending Brent crude up around 5–6% in early Asian trade. S&P 500 futures dropped 0.6% and European futures fell 1.1%, though Asian equity markets largely shrugged off the tension. The dollar firmed, with the euro slipping to around $1.1735. For European manufacturers, the immediate concern is the inflationary impulse from elevated energy costs — a dynamic that could complicate the ECB's easing trajectory. In a brighter development, Chancellor Merz and President Lula used the Hanover industrial fair to welcome the EU-Mercosur free trade agreement entering force on May 1, with Lula highlighting Brazil's vast reserves of nickel, graphite and rare earths.

Shanghai copper rose 0.73% to 102,780 yuan/mt on Monday, underpinned by persistent destocking in China. SHFE copper inventories fell 9.8% week-on-week to 240,456 tonnes on Friday, down nearly 45% since mid-March, signalling robust downstream consumption. The Yangshan copper premium held firm at $68/mt. Peru's Energy and Mines Ministry authorised the start of exploitation at Southern Copper's long-delayed Tia Maria project — a potential source of incremental supply, though meaningful output is years away. On the demand side, EV sales across Europe's main markets surged 29.4% year-on-year in Q1 2026, with March alone up 51.3%, driven by drivers seeking alternatives to expensive petrol — a structural tailwind for copper and aluminium intensity. Tongling Nonferrous reported 2025 net profit down 14% year-on-year, reflecting the squeeze on Chinese smelter margins from tight concentrate supply.

Gold fell 0.7% to $4,794 as the dollar strengthened on renewed Middle East tensions. The "war trade" dynamic reasserted itself: surging oil prices fed inflation expectations, pushing Treasury yields higher and undermining the non-yielding metal. Gold has now dropped roughly 8% since the U.S.-Israeli strikes on Iran in late February. Silver shed 0.9% to $80.04, platinum dipped 0.5% to $2,094, and palladium was flat at $1,559. In India, demand during the Akshaya Tritiya festival was muted as record prices curbed jewellery buying, though investment demand via coins showed a modest uptick.

Rebar and hot-rolled coil on the Shanghai Futures Exchange both gained around 0.8% on Monday, supported by steady hot metal output in China — daily production at 247 surveyed mills rose to 2.395 million tonnes, with blast furnace utilisation rates ticking higher. Coking coal and coke surged nearly 3% and 2.2% respectively, tracking energy costs higher as the Hormuz closure threatens freight and fuel supply chains. Iron ore futures firmed on inventory destocking from relatively high portside levels, with SHFE iron ore up 0.58% to 782 yuan/mt and Singapore benchmark May iron ore up 0.38% to $106.2/mt. European steelmakers face a double squeeze from elevated energy input costs and the broader macro uncertainty.

China's rare earth magnet exports in March fell 1.6% year-on-year to 5,238 tonnes, though they rose 10.5% from February. Germany was among the top five destinations. Notably, exports to the U.S. dropped for a fifth consecutive month to a nine-month low of 406 tonnes, down 30.6% year-on-year — a trend that underscores the ongoing decoupling in critical mineral supply chains. Q1 2026 exports were still up 4.8% year-on-year at 16,001 tonnes. Separately, European Lithium and CRML acquired full control of the Tanbreez rare earth project in Greenland after government approval, while Brazilian Critical Minerals and Southern Alliance Mining entered discussions on rare earth production cooperation.

The dollar firmed on Monday as the Hormuz closure revived safe-haven flows, reversing last week's sharp selloff. The euro slipped to $1.1735, down from around $1.1760 on Friday, as European futures fell 1.1% and the region's energy vulnerability came back into focus. The yen weakened to around 159 per dollar. For European scrap traders, the stronger dollar makes dollar-denominated metals marginally more expensive in euro terms, though the move remains modest. The key variable this week is whether the ceasefire holds — a collapse would likely drive further dollar strength and euro weakness as energy inflation fears intensify.

The U.S.-Iran ceasefire expires on Tuesday, making today's diplomatic signals critical for oil and metals direction. UK Prime Minister Starmer addresses parliament amid political turmoil. Canada CPI data is due. European PMI figures later this week will be closely watched for signs of how the energy shock is filtering through to manufacturing activity.