By Tunahan Kukurt and Emir Yildirim
ISTANBUL (AA) – Commodity markets displayed mixed trends last week amid concerns over President Donald Trump’s policies, geopolitical developments, and economic volatility.
As global markets navigate the challenges of inflation and recession, Trump’s “America First” policies continue to influence US exports and contribute to price fluctuations. Meanwhile, discussions on ending the war in Ukraine and the US-Ukraine agreement on rare earth elements remain key factors shaping market sentiment.
Goldman Sachs stated last week that while Trump's tariffs may provide a short-term boost to energy and metals production, his broader "commodity dominance" strategy could have longer-term implications. The administration is prioritizing commodities in trade and foreign policy, aiming to strengthen US energy exports, enhance geopolitical influence, and reduce reliance on China for key metals.
- Metals market sees fluctuations
Gold, which reached a record high of $2,956 per ounce, ended its eight-week rally with a 2.59% decline, closing at $2,859 per ounce. The World Gold Council (WGC) reported that gold-backed exchange-traded funds (ETFs) saw their largest weekly inflow since March 2022.
The US Dollar Index strengthened due to uncertainties surrounding Trump’s policies, exerting selling pressure on gold.
Silver fell 4.3%, palladium 5%, and platinum 2.4% per ounce last week.
Base metals followed a mixed trajectory as investors monitored developments in Ukraine.
Russian President Vladimir Putin proposed a deal offering the US access to rare earth deposits in Russia and aluminum supplies to the domestic market of America.
Russia’s Ministry of Natural Resources and Environment reported that the country holds 658 million tons of rare earth reserves across 29 regions.
Copper prices fell 0.9% per pound as a large-scale power outage in Chile, the world’s leading copper producer, raised concerns over supply disruptions, partially offsetting the impact of Trump’s tariff policies.
Aluminum and zinc dropped 1.8% and 1.7%, respectively, while nickel gained 1.1% and lead rose 0.3% per pound last week.
- Energy sector under pressure
The energy market faced downward pressure after the US Senate passed a resolution overturning the Biden administration’s methane fee regulations for major oil and gas producers.
Brent crude oil declined 1.3% per barrel amid expectations that Iraq’s Kurdistan Region will resume oil exports and that peace talks in Ukraine could increase global supply, limiting price gains.
Russia extended oil export permits for domestic producers until August 2025 to stabilize fuel markets and support its refinery sector.
Trump announced on Truth Social that he had revoked agreements signed by the Biden administration with Venezuela. The exemptions, introduced on Nov. 26, 2022, had eased sanctions on Venezuelan oil sales.
Natural gas prices dropped sharply, falling 9.8% last week.
- Agricultural commodities post losses
Agricultural markets experienced widespread declines due to production challenges and export difficulties linked to Trump’s policies.
Wheat fell 7.1% per bushel, reaching a five-week low amid weak US export demand. The US Department of Agriculture (USDA) projected that wheat planting will rise to 47 million acres, with stocks reaching 826 million bushels in 2025. Meanwhile, Russia maintained its wheat production forecast at 81-82 million tons.
Corn prices dropped 7% per bushel after US corn exports hit a seven-week low at 794,694 tons. The USDA expects US corn planting to increase to 94 million acres, with a projected yield of 181 bushels per acre in 2025.
Soybeans declined 2.8%, while rice fell 2.3% per bushel.
Cocoa prices dipped 0.2% after Ivory Coast’s agriculture minister confirmed that production for the 2024-25 season would remain at last year’s low levels due to unfavorable weather conditions.
Sugar prices dropped 7.1% following failed negotiations to lift China’s ban on sugar imports from Thailand. China had halted Thai sugar imports in December over factory hygiene concerns.
Cotton fell 1.1%, while coffee prices dropped 4.2% per bushel last week.