Metal Raw Material Price Trends in the First Half of 2025

I. Introduction

In the first half of 2025, the global metal raw materials market has experienced remarkable price fluctuations and structural shifts, driven by supply chain disruptions, geopolitical dynamics, and changing industrial demand. In industries like steel and metal manufacturing, heavy machinery making, and advanced materials, keeping up with these price trends isn’t just about economics. It’s a key part of managing costs, avoiding risks, and planning for the future.

This article provides a comprehensive analysis of the metal raw material price trends during the first half of 2025. It examines key drivers behind price shifts in copper, tin, aluminum, nickel, lead, zinc, iron ore, and rare earths. It points out the market risks, talks about procurement strategies, and offers some future-focused suggestions for people in the industry.

II. Overview of Key Metal Price Movements

A. Copper: A Year of Strong Gains and Volatility

Copper, widely regarded as the “barometer of the global economy,” posted strong price gains in the first half of 2025. On COMEX, copper surged to $5.37 per pound on March 26, marking a 20% increase within three months.

On LME, copper briefly breached $10,000 per ton, reaching $10,164 in mid-March before falling to $8,100 amid tariff-related volatility, and later stabilizing above $9,000. SHFE copper followed the worldwide trend, but China’s slower demand recovery showed up in some regional differences.

A key factor was the massive inventory drawdown: LME stocks plunged from 271,400 tons in January to 90,600 tons by June—a decline of over 60%. This inventory crunch, combined with speculative trading between CME and LME, amplified volatility. According to Reuters, copper ended the first half of 2025 up around 12% year-to-date.

B. Tin: Supply Disruptions Drive Extreme Price Swings

Tin recorded some of the sharpest fluctuations in 2025: In May, prices soared to $38,395 per ton, a three-year high. By June, they collapsed to $28,925 per ton, only to rebound above $33,500 amid renewed supply concerns.

The main reason was the supply problem at Myanmar’s Man Maw mine, which is still shut down. This has really made it harder to get supplies worldwide. Given that tin production is heavily concentrated, even small disruptions can cause sharp price moves.

C. Aluminum: Regional Divergence Despite Global Stability

Aluminum’s price trajectory was more muted compared to copper and tin. Globally, LME aluminum gained around 3% in the first half.

In the U.S., however, tariffs of up to 50% on aluminum imports triggered a sharp rise in regional premiums, especially in the Midwest, leading to significant geographical price divergence. This reflected a growing theme in 2025: regional fragmentation of global metal pricing.

D. Nickel: Oversupply Keeps Prices Flat

Unlike copper and tin, nickel prices remained subdued. By mid-2025, LME nickel was trading flat compared to January, hovering near $15,000 per ton.

The oversupply was fueled by Indonesia’s massive production expansion and weakening demand from Chinese EV battery producers, who increasingly shifted toward lithium-iron-phosphate (LFP) chemistries, reducing nickel intensity. This combination of oversupply and declining demand growth kept nickel prices stagnant.

E. Lead: Supported by Seasonal Demand

Lead prices rose around 6% in the first half, largely due to seasonal demand for automotive batteries in the northern hemisphere. This made lead one of the few base metals with a relatively stable upward trajectory.

F. Zinc: Weighed Down by Oversupply

In contrast, zinc struggled: Refined zinc production exceeded demand by 151,000 tons globally, leading to an estimated 6% decline in prices on the LME. Weak demand from construction sectors in China and Europe compounded the pressure.

III. Iron Ore: Sliding Prices Amid Supply Growth

Iron ore faced a particularly challenging first half of 2025. Prices averaged $107.81 per ton, down from $223.94 per ton in 2021, cutting deeply into miner profits. Supply growth from Brazil (Vale) and Guinea (Simandou project) combined with weaker Chinese demand accelerated the price slump. Moody’s projects that over the next 18 months, iron ore will remain trapped between $80–100 per ton (Economic Times).

IV. Rare Earths: Strategic Metals See Sharp Gains

Rare earth elements (REEs), particularly NdPr (neodymium-praseodymium), saw sharp increases. Prices rose 40% in China, jumping from $63 to $88 per kilogram. The surge followed MP Materials halting shipments to China, showing how rare earth supply chains are affected by political tensions between countries (Reuters).

This shows how important rare earths are for the clean energy transition, and how they could be affected by trade restrictions.

V. Global Macroeconomic Drivers Behind Metal Price Trends

A. Geopolitical Tensions and Trade Policies

Geopolitics has played an outsized role:

• US-China Tariff Escalation: The U.S. imposed tariffs of up to 25–50% on Chinese steel, aluminum, and EV-related products. In response, China adjusted its export policies, further fragmenting global markets.
• Sanctions and Regional Realignments: Ongoing sanctions on Russia limited its ability to export aluminum and nickel, tightening European supply chains but redirecting flows toward Asia.
• Resource Nationalism: Countries such as Indonesia doubled down on restrictions for nickel and bauxite exports, insisting on local processing to capture more value domestically.

These moves have created regional price disparities, breaking the long-standing pattern of globally uniform benchmarks.

B. Energy Transition and Decarbonization Push

The global energy transition continues to reshape raw material demand. Copper is central to electrification, powering grids, EVs, and renewable installations. Aluminum demand is rising in lightweight transport solutions and solar infrastructure. Rare earths remain indispensable for EV motors and wind turbines. As countries race toward net-zero targets, demand for these metals is increasingly structural rather than cyclical, supporting higher long-term prices despite near-term volatility.

C. Monetary Policies and Currency Fluctuations

Global central banks’ monetary policies have added another layer of volatility. A stronger U.S. dollar in early 2025 pressured dollar-denominated metals, briefly weighing on copper and aluminum. Emerging market currencies, particularly in Africa and Latin America (major mining hubs), depreciated, affecting local production costs and export competitiveness. Such currency shifts often amplify price swings in metals markets, especially for import-dependent regions.

VI. Sectoral Impact Analysis

A. Steel and Metal Manufacturing

For steelmakers, the biggest challenge has been iron ore’s declining trajectory combined with rising coking coal costs, squeezing margins. Producers in China, the world’s largest steel market, faced profitability pressure, leading to reduced output in certain provinces.

At the same time, higher copper and aluminum prices raised input costs for downstream metal fabricators, forcing many to pass costs onto end-users or cut production.

B. Heavy Machinery and Equipment Manufacturing

Heavy machinery producers rely heavily on steel, aluminum, and copper. The divergence in metal prices has created a mixed cost environment: Steel structures became cheaper due to lower iron ore. Electrical systems became costlier because of copper price surges. Hydraulic and alloy components faced moderate increases due to zinc and lead. This uneven pricing environment has forced equipment manufacturers to rethink sourcing strategies and diversify supply chains.

C. Advanced Materials and Tooling Sectors

Sectors producing carbide tools, roll rings, and specialty alloys—such as TY High Tech—have been significantly affected by tungsten, cobalt, and rare earth pricing trends. Cemented carbide tooling remains highly sensitive to cobalt and tungsten fluctuations. Rare earth surges have raised costs for high-performance magnets used in advanced machining and robotics. Suppliers in this niche are turning toward long-term supply contracts and strategic stockpiling to ensure production stability.

VII. Strategic Procurement and Risk Management

A. Hedging Against Price Volatility

Large manufacturers are increasingly adopting futures contracts on LME/SHFE/COMEX for hedging copper, aluminum, and zinc. Over-the-counter (OTC) contracts for niche metals like cobalt and rare earths are also growing. Hedging helps stabilize costs, ensuring budget predictability even when spot markets fluctuate wildly.

B. Inventory and Stockpiling Strategies

Firms are rethinking just-in-time (JIT) procurement models. Many are building buffer inventories of critical metals to prevent supply chain disruptions. Some governments, particularly in Asia, are expanding strategic reserves of copper, rare earths, and nickel to safeguard against geopolitical shocks.

C. Supply Chain Diversification

Diversification has become a survival strategy:

• Geographic diversification: Importers are sourcing from multiple regions to reduce over-reliance on one supplier (e.g., diversifying rare earth supply beyond China).
• Material substitution: EV manufacturers are shifting from nickel-rich chemistries to LFP batteries, reducing exposure to nickel price risks.
• Recycling and circular economy: Scrap metal recovery is emerging as a cost-effective secondary supply.

VIII. Outlook for the Second Half of 2025

Looking ahead, several scenarios could shape metal prices:

• Copper: Prices likely to remain above $9,000 per ton, with further upside if supply disruptions persist.
• Tin: Volatility will continue as long as Myanmar’s mine remains offline.
• Aluminum: Regional divergence will persist due to tariffs.
• Nickel: Oversupply will keep prices subdued unless Indonesia curtails exports.
• Iron ore: Expected to slide further toward the $90 range.
• Rare earths: Strategic demand and geopolitical tension will keep prices elevated.

IX. Frequently Asked Questions (FAQs)

Q1: Why have copper prices surged in early 2025?
A1: Tight inventories, strong demand from electrification projects, and speculative activity drove copper above $10,000/ton in March.

Q2: Which metal showed the highest volatility in 2025?
A2: Tin, due to supply disruptions in Myanmar, saw swings of over 30% within weeks.

Q3: Why is nickel underperforming compared to other metals?
A3: Oversupply from Indonesia and lower demand from EV manufacturers shifting to LFP batteries have kept prices flat.

Q4: What’s the outlook for iron ore?
A4: With supply growth and weak Chinese demand, prices are projected to remain in the $80–100/ton range.

Q5: How should manufacturers mitigate raw material price risks?
A5: By adopting hedging tools, diversifying suppliers, building inventories, and exploring recycling options.

Q6: Are rare earths at risk of further price increases?
A6: Yes. With geopolitical tensions and supply chain vulnerabilities, rare earths may see sustained upward pressure.

X. Conclusion

The first half of 2025 has reinforced a clear message: metal raw material markets are entering a new era of structural volatility. Prices are no longer shaped solely by demand and supply fundamentals but by geopolitical, environmental, and technological forces.

For stakeholders in steel, heavy machinery, and advanced materials industries, adapting to this reality is essential. Companies that integrate certified sourcing, proactive hedging, inventory buffers, and supply chain diversification will not only survive but thrive in this environment.

Ultimately, while price risks remain elevated, these challenges also bring opportunities for innovation, strategic positioning, and long-term competitiveness.