Commodities daily round up 28-Nov-2025

Commodities traded with mixed results on Friday. Precious metals, especially silver, surged to new highs while energy markets remained under pressure. Agricultural products showed limited movement with grains steady and sugar edging higher. Overall trading was cautious as investors balanced inflation data against central bank uncertainty, avoiding extreme volatility in most sectors.

Key drivers included Tokyo's higher-than-expected inflation (2.8% year-on-year), which sparked Bank of Japan rate hike speculation, and a weaker US dollar that lifted dollar-priced commodities. Oil prices were constrained by rising supply from OPEC+ members and non-OPEC producers, while China's new platinum futures contract created unexpected demand. Market sentiment remained cautious due to global trade tensions and uncertainty about central bank policies, with investors avoiding aggressive positions.

Oil prices stayed rangebound with Brent crude hovering around $63 per barrel. Rising supply from both OPEC+ and non-OPEC producers pressured prices, though temporary hopes of a Russia-Ukraine peace deal provided brief support that later faded. Natural gas remained under pressure as US storage levels sat 4% above the five-year average and European facilities were approximately 95% full, reducing winter shortage concerns despite seasonal demand increases.

Precious metals surged as silver exploded nearly 7% to a historic high above $56 per ounce, breaking its October record. Gold climbed on falling real yields and strong central bank buying, briefly touching $4,100 per ounce. Platinum jumped following China's launch of new futures contracts for retail and institutional investors, addressing tight physical supply. Investors showed defensive positioning amid inflation concerns and dollar weakness, with ETF inflows supporting metals demand.

Industrial metals gained as copper advanced on expectations of a 150,000-tonne supply deficit by 2026, with mine growth projected at just 1.4% for 2025. Lithium prices remained weak in the low to mid $10,000 per tonne range despite strong electric vehicle and solar panel demand, weighed down by persistent oversupply. Tight physical markets and new Chinese trading mechanisms provided additional support for platinum group metals.

Agricultural markets were mixed as traders awaited renewed Chinese soybean purchases, with China having taken only about 2 million metric tons of a promised 12 million. Wheat remained under pressure due to global oversupply despite cold-weather demand expectations. Sugar prices edged higher as technical buying emerged after consolidating above 15.05, while livestock markets split with lean hogs gaining but cattle declining. Cotton extended losses to five-year lows amid weak export demand.

Major developments included Tokyo's core consumer prices rising 2.8% year-on-year, fueling Bank of Japan rate hike speculation. China's launch of platinum futures trading created immediate market impact, while slow progress on soybean purchase commitments weighed on grain markets. The CME futures disruption caused temporary trading delays but didn't significantly alter price trajectories. Global storage data showing elevated natural gas levels also influenced energy sentiment.

Bank of Japan Governor Kazuo Ueda cautioned that global trade volatility could impact growth, making rate hike timing uncertain despite strong inflation data. Analysts at Saxo Bank noted crude oil's 'steepest run of monthly losses since 2023' due to supply pressures, while Global X analysts highlighted copper's structural deficit outlook. Market participants observed wheat's 'tremendous oversupply' keeping prices contained despite seasonal demand factors.

Silver was the standout performer, surging nearly 7% to breach $56 per ounce for the first time. Platinum saw exceptional movement following China's new futures contract launch, while cotton extended declines to five-year lows. Lean hogs showed notable strength amid mixed livestock performance, and sugar markets attracted attention as technical buying emerged after consolidating key levels. Gold's movement was supported by significant ETF inflows totaling approximately $8.2 billion in October.

Commodities ended the day mixed, with precious and industrial metals gaining while energy and some agricultural products declined. Investors should monitor the Bank of Japan's policy decision next week, potential progress on China's agricultural purchases, and weather developments affecting crop conditions. Natural gas storage levels and OPEC+ supply signals will also be critical as winter demand increases in the Northern Hemisphere.