Goldman Sachs' global head of metals and bulk trading, Tony Kim, has recently shared his outlook on the future trajectory of key commodities including gold, silver, copper, and aluminum.
He cautions that the current environment is unfavorable for gold prices to set new records, and the bullish narrative for copper is not very convincing.
In contrast, aluminum, due to supply disruptions in the Middle East, has the clearest short-term supply-demand imbalance, with prices potentially testing the $4,000 per tonne threshold.
Regarding the market's hot topic of whether gold has a chance to surge to $6,000 per ounce, Kim expresses skepticism.
He points out that Middle Eastern oil-producing nations, facing declining crude oil revenues, have fewer US dollar funds available for allocating to assets like US Treasury bonds and gold.
Furthermore, rising energy and food costs, coupled with ongoing expansion in AI-related investments, are intensifying inflationary pressures, leading to increased market expectations for both nominal and real interest rates.
Turning to the silver market, while industrial demand has indeed improved, the key factor currently influencing price movements remains investment demand.
He is cautious about the view held by some optimistic market participants predicting silver prices will break through $100 per ounce, believing it will not be easy to reach this target in the short term.
Regarding the copper market, he notes that the global copper market is still in a state of relatively ample supply, with no significant shortage evident, and inventory levels have even risen to near five-year highs.
The future direction of US tariff policies could become a significant variable influencing copper prices.
Goldman Sachs currently maintains a neutral outlook on copper price movements over the next three to six months.
Kim views aluminum as a "very interesting trading item" at present, believing it is at a critical inflection point.
The driver for aluminum comes from a genuine supply deficit.
Conflict in the Middle East has severely impacted several small local smelters, and spot market supply is expected to remain tight through the summer.
Kim points out that the earliest damaged smelters could resume production is by year-end, with some industry participants estimating it could take over 12 months.
He states, "Supply will definitely continue to be affected. We believe aluminum prices may need to rise further, potentially even testing $4,000, which is about a 10% increase from current levels."
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