Good morning! Here are the key updates.
**Gold Prices Could Rise 30% by 2026, Says WGC** The World Gold Council (WGC) projected in a Thursday report that gold prices may climb another 15%–30% by 2026. The WGC cited falling U.S. Treasury yields, elevated geopolitical risks, and heightened safe-haven demand as major tailwinds for the metal.
**Mercuria Withdraws Large Copper Volumes from LME** Commodity trading giant Mercuria has reportedly notified plans to extract significant copper volumes from London Metal Exchange (LME) warehouses in Asia. LME data showed a surge in copper withdrawal requests—up 50,575 tons (the largest tonnage increase since 2013) to 56,875 tons, representing 35% of total LME stockpiles.
Analysts suggest most of the withdrawn copper was shipped to the U.S., where refined copper previously enjoyed tariff exemptions under the Trump administration. However, the Defense Production Act later classified copper as a critical mineral to secure domestic supply.
Mercuria executive Kostas Bintas recently reiterated bullish copper forecasts, warning that U.S.-bound shipments could drain global inventories and drive prices higher. Supply disruptions in Indonesia and Chile, coupled with historically low LME warehouse stocks, have further fueled the rally.
Copper prices dipped slightly from record highs on Thursday as traders noted easing panic over supply constraints. LME data revealed 7,775 tons of copper warrants canceled in South Korea, following 50,725 tons canceled in Asian warehouses the prior day.
**U.S. Jobless Claims Hit 2022 Low** Initial U.S. jobless claims fell by 27,000 to 191,000 for the week ending November 29—the lowest since September 2022—underscoring labor market resilience despite Wednesday’s ADP report showing the steepest private-sector job decline in 2.5 years. The delayed November nonfarm payrolls report, now due December 16, is expected to reflect a "no-layoffs, no-hiring" trend.
CME’s FedWatch Tool priced an 87% chance of a 25-basis-point December rate cut (down from 89.2% on December 3), with 64.1% odds of cumulative cuts by January.
**Pulp Futures Extend Gains on Production Cuts** Pulp futures rebounded for three consecutive sessions in December, with the SP2601 contract briefly topping 5,500 yuan/ton before settling at 5,496 yuan/ton—up 5.73% weekly.
Supply concerns mounted as Domtar permanently shuttered its 380,000-ton/year NBSK pulp mill in Canada’s Crofton, while Metsä Fibre’s 650,000-ton Rauma mill announced a temporary halt from December 15, with phased restarts planned by January 2026.
CITIC Futures analyst Li Qing noted that while current production cuts are limited to high-cost mills, Crofton’s closure sparked speculation about further shutdowns amid unsustainable losses. Cost pressures also rose, with hardwood pulp prices climbing: Chile’s Arauco raised November offers to $550/ton, while APRIL and Bracel hiked Asian BHK pulp prices by $20/ton. Domestic producer Asia Symbol lifted prices by 150 yuan/ton.
However, downstream paper producers struggled to pass on costs, with weak demand capping price hikes. Operating rates for cultural paper declined due to oversupply, while tissue paper remained robust.
Li cautioned that futures face resistance at 5,500–5,600 yuan/ton, with upside limited unless spot prices strengthen. Guotai Junan analyst Gao Linlin emphasized monitoring inventory drawdowns and paper price hikes for sustained momentum.
In summary, pulp futures rallied on sentiment-driven factors despite unchanged fundamentals, with near-term volatility expected.
Comments