Traders are placing substantial bets on Chinese metal markets, anticipating continued increases in the prices of base metals and lithium. Open interest figures for several metals, specifically copper, zinc, nickel, tin, lead, and aluminum traded on the Shanghai Futures Exchange, reached record highs at the close of 2025 and the beginning of 2026. Furthermore, near-record open interest was observed in lithium derivatives on the Guangzhou Futures Exchange. Several factors contribute to this pronounced speculative activity, including concerns regarding constrained global metal supply, lower interest rates fueling investment in metal commodities, and sustained industrial and electrification demand despite ongoing U.S. trade policies. Trading volumes on the Shanghai Futures Exchange for the six base metals surged by over 260% compared to the previous year, according to data compiled by Bloomberg. A significant trading turnover of 37.1 trillion Chinese yuan, equivalent to $5.3 trillion, occurred in the base metals plus gold and silver transactions during December alone. Trading volume in copper reached a peak on December 29th, representing the highest recorded levels in Shanghai over the past decade, as reported by Bloomberg’s analysis. Simultaneously, copper prices on the London Stock Exchange were experiencing a sequence of record-breaking increases.
On the Guangzhou Futures Exchange, open interest and trading volumes in lithium both attained historic highs in November 2025 before a decrease was noted in December due to the exchange implementing increased fees and limiting new position openings. Despite this December decline, open interest and trading volumes at Guangzhou remain at historically high levels, indicating that speculators are continuing to bet on this key battery and energy transition metal. Industry analysts at ING commodities strategists Warren Patterson and Ewa Manthey noted in early December, when copper prices were trending towards record highs, that “Most base metals are likely to remain well supported next year.” Uncertainty related to U.S. tariffs, tighter markets driven by supply disruptions, and a weaker U.S. dollar are expected to further bolster metals markets. ING’s assessment highlighted these as key drivers.
Global aluminum markets are also expected to remain tight, with China nearing its production production cap and other producers considering closures due to elevated power prices. Nickel prices also saw a sharp increase, jumping by 10% in a single day in London this week as buying activity intensified in China. Despite a generally oversupplied nickel market, concerns regarding potential disruptions in Indonesia, the world’s leading nickel producer, fueled bullish sentiment. The substantial trading volumes on the Chinese market further underpinned nickel prices during the initial days of 2026. Copper has emerged as the leading base metal over the past year, achieving record highs as supply disruptions and U.S. trade policies have generated anxieties about potential shortages. Copper prices peaked at $12,000 per ton on the London Metal Exchange at the close of December 2025 and recorded their largest annual gain since 2009 in 2025. This upward trend continued into 2026, with prices reaching $13,000 per ton this week. Copper prices had already increased by 16% since the beginning of December.
Recent months have witnessed a rally in copper prices fueled by threats from the Trump Administration related to tariffs on the industrial metal, crucial for electrification and grid expansion. Traders are accumulating copper in the United States, which has boosted prices at the Comex exchange in New York and reduced supply elsewhere. Furthermore, increased investment from funds is becoming a significant market driver, linked to demand from AI-related data centers and electrification themes, according to analysts at Benchmark Mineralssaidthis week. The trends point to sustained demand and speculation supporting the elevated prices of key metals.
