A new era for copper, uranium and gold?

Last year, investors and analysts scrambled to predict what a second Trump presidency might mean for markets. Some envisioned a stock market boom driven by tax cuts and deregulation, while others braced for global chaos, fearing trade wars and geopolitical uncertainty. Indeed, the range of predictions reflected the sheer unpredictability of Trump’s policy agenda.

Now, roughly two months into Trump’s second term, many of those big questions remain unanswered. However, enough has transpired that those paying close attention can start to paint a clearer picture of what is unfolding. In this article, we take a deep dive into three commodities— copper, uranium and gold – and examine how Trump’s early moves have shaken things up and where investors might find opportunities in 2025.

Key Takeaways

• Tariff-related concerns are still present, but much less prevalent than initially expected. Structural supply and demand should help temper some of the bearish sentiment that weighed on industrial commodities late last year.
• A resolution in the Russia-Ukraine conflict could shift US foreign policy—the potential lifting of US sanctions presents downside risks for certain commodities, particularly those that have benefited from supply constraints.
• Softer-than-expected tariff retaliation from China (so far) and a bullish innovation narrative could be supportive of Chinese economic resurgence, especially as signs suggest the economy has bottomed out.

Dr. Copper’s diagnosis is… mixed

Copper is integral to nearly every aspect of a healthy, growing economy. As such, its demand and pricing are often seen as a barometer of global economic health. This also meant it was among the first commodities to react to the policy uncertainty following Trump’s election in November. Tariffs, in particular, were a focal point. Markets expected 1) tariffs would significantly slow economic growth in targeted economies as demand for goods weakened, and 2) tit-for-tat retaliation could escalate into a global trade war, benefiting few while harming many.

Now, 50 days into Trump’s presidency, the administration’s approach to tariff enforcement has been more measured than anticipated. The first round of tariffs—a sweeping 25% tax that unexpectedly targeted Mexico and Canada—was delayed, while the widely feared 60% tariff on Chinese imports was scaled down to a more modest 10%. This shift led markets to believe that US tariffs would serve more as a negotiation tool than a revenue source, prompting copper to rally as much as 10% from its late 2024 lows.

However, as the second round of Trump’s tariffs comes into effect (25% on Canada, Mexico, and further 10% on China), the market dynamic is shifting once more. Here’s what we’re watching and expect for copper over the coming months.

In the short term, copper price should remain resilient and may even move higher. While Canada and Mexico are significant copper producers, Chile remains the dominant supplier to the US, accounting for 60% of imports.(1) Since Chilean producers are unaffected at this stage, the overall supply chain will not face immediate disruption and copper demand should remain strong. Increased costs for Canadian and Mexican imports could, however, push US buyers to front-load shipments before tariffs fully impact pricing, supporting prices in the near term.

Additionally, Trump’s recent executive order directing a national security review of copper imports will likely heighten uncertainty. If markets perceive a risk of broader tariffs covering all copper imports, buyers may further accelerate purchases. This has already been reflected in copper futures, with US contracts trading at a near-record premium to the London Metal Exchange (LME) in recent weeks.

In the medium-to-long term, copper’s fate is less certain. There are myriad catalysts, both tail and headwinds which could impact the copper price. Among them, investors should keep an eye on the following:

• Bearish – More tariffs: Trump has shown a preference for implementing tariffs in waves, rather than all at once. This could result in softer immediate impacts on the US and global economy; however, any further tariffs would nonetheless likely be negative for copper prices looking ahead.
• Bearish – Copper-specific tariffs: The outcome of the US Department of Commerce’s investigation into copper tariffs will be the single most important aspect to watch for copper investors. Should tariffs be enforced, investors should note the breadth of their coverage – whether all or just some forms of copper imports will be restricted. More extensive tariffs will likely have a negative effect on global copper miners; however, US copper miners may benefit from domestic copper premiums.

• Bullish – Chinese economic resurgence: China is the single largest consumer of copper and accounts for more than half of total global copper demand. (2) While the middle kingdom has undoubtedly run into economic quagmire ever since its botched exit from pandemic lockdowns, there are signs that the economy is healing. Chinese manufacturing PMI recently re-entered expansionary territory, showing signs of resilience in the CCP’s focus industries. (3) The Chinese property sector, also a large consumer of copper, has also shown signs of stabilisation with housing prices falling at its slowest pace since 2023. (4) If China can successfully navigate US’s tariffs and provide sufficient economic stimulus, a Chinese economic resurgence will bode well for copper prices. China’s recent ambitious 5% GDP growth target by the NPC is also supportive of this narrative.
• Bullish – Structural tailwinds persist: Global megatrends including electrification, renewable energy, and grid expansion, remain intact despite Trump’s disruptive policies. However, lower copper prices may disincentivise development of greenfield copper projects, which may worsen the projected supply deficit. In this sense, we view any fall in valuation for copper miners from the enforcement of tariffs as a great buying opportunity for long-term investors.

Uranium: From Russia with love

Uranium’s record-breaking rally in early 2024 was largely driven by a mix of AI-driven energy demand forecasts, projected supply shortages from KazAtomProm—the world’s largest uranium producer by volume—and a somewhat frothy bullish sentiment. Many of these tailwinds still exist, albeit in weaker forms than previously expected. Nonetheless, uranium and nuclear adoption continues to enjoy structural support from government policy and the overall energy transition.

Spot uranium prices have now fallen ~10% year-to-date. Much of this decline can be attributed to Trump’s surprisingly soft stance on Russia throughout his attempts to broker a peace deal between Russia and Ukraine. For context, Russia controls more than 40% of the global uranium enrichment capacity, as well as 5% of total mine production. (5) Much of that capacity had been inaccessible to the US – home to the largest nuclear fleet in the world – since sanctions were enforced in May 2024. (6) However, traders are now pricing in the possibility that Trump may lift these sanctions to improve relations with Russia. If that happens, the global uranium supply picture could improve, exerting short-term pressure on spot prices.

From a technical standpoint, the uranium price is unlikely to extend its fall much further. Long-term contracts (supply deals between miners and utility firms) control more than 70% of the uranium market, and despite spot uranium’s collapse since January 2024, long-term uranium has shown resilience, maintaining its price above US$80 per pound alongside significant contracting volume. This shows that utility firms are confident that the uranium price will remain elevated, and that they continue to prioritise supply security.

It is worth noting that Trump’s latest round of tariffs on Canada will impact more than a quarter of uranium imports into the US. However, given Canadian energy exports will only be tariffed at 10%, rather than the broad 25% on all other Canadian goods, it is unlikely the uranium price will face significant distortion. US’s utilities-driven uranium demand is also relatively inelastic, especially given the tight supply picture over the past year. Nonetheless, Cameco, the top Canadian uranium producer, has indicated that it is in the process of diversifying away from the US to opportunities in other markets including Central and Eastern Europe. (7) Overall, uranium miners are unlikely to be significantly impacted by tariffs at this stage.

In the long term, uranium continues to be structurally supported by a meaningful supply deficit and the global energy transition. In late 2023, 20 nations agreed at the COP28 conference to triple nuclear energy capacity by 2050. This pledge then grew to 31 countries after COP29 was held in November 2024. (8) While this already bodes positively for uranium infrastructure and engineering firms, it paints an even more beneficial picture for uranium and uranium miners.

Uranium supply has been supported by drawdowns in commercial inventories for the past five years as miners operated on minimal capacity due to unattractive pricing. That commercial inventory has begun to run dry, and miners have started to fill the gap by increasing output. However, should all 31 countries follow through with expanding their nuclear energy capacity, even a significant growth in supply may not be sufficient. Studies by Cameco, UxC and Sprott suggests that, under the net-zero nuclear scenario, a sustained uranium supply-demand imbalance may continue through at least 2040. (9) As such, further investments in uranium miners are needed to match the expected supply deficit.

Portfolios with a heart of Gold

After a brilliant year of gains for gold in 2024, the precious metal has continued to hit all-time highs to kick off 2025. Three key ideas in the market are causing this phenomenon: Subverted expectations, geopolitical polarisation, and simply “a lack of options”.

Subverted expectations – Markets underestimated uncertainty

The past year was marked by historic volatility, driven by geopolitical shifts and economic uncertainty. Gold responded as expected, rallying to a high of US$2,780 per ounce ahead of the US election, as investors and central banks alike sought a reliable hedge.

Following the election, market sentiment shifted. Confidence that policy clarity would eventually arrive prompted investors to pivot toward risk assets such as big tech, AI and cryptocurrency. However, as the new administration took shape, it was evident that the market underestimated the persistence of uncertainty. Within weeks, President Trump has imposed, delayed, and reintroduced tariffs on key trade partners, while geopolitical tensions—including stalled progress in Ukraine—have deepened. Meanwhile, AI’s bullish momentum has been tempered by the rise of DeepSeek, and emerging markets ex-China have significantly underperformed.

Evidently, the anticipated stability has not materialised. Instead, volatility persists, prompting a renewed shift toward gold as investors reassess their expectations. As 2025 unfolds, the market’s confidence in a smooth trajectory appears increasingly misplaced, reinforcing gold’s role as a crucial asset in times of uncertainty.

Geopolitical polarisation drives Central Bank Gold buying

The current geopolitical landscape is more complex and unpredictable than at any point since World War II, driven by erosion of global institutions and the convergence of multiple crises. A defining trend has been the widening rift between US allies and independent, non-aligned actors—a divide that extends beyond military and diplomatic spheres into economic strategy.

One key manifestation of this shift is the move away from US Treasuries in favour of gold among non-aligned nations. This is not a new development, but the trend has certainly accelerated since the turn of the decade. Global central banks have been net buyers of gold for 15 years in a row, but the pace of central bank purchases have doubled following the Russia-Ukraine war, signalling a broader push for financial self-sufficiency. China’s PBOC has been a leading participant, accumulating gold for 18 consecutive months before a brief pause, only to resume its buying streak in December 2024. Other nations, including India and Poland, have also been major buyers.

This trend underscores a structural shift in global reserves, with geopolitical tensions reinforcing demand for gold. Indeed, whether central banks continue their buying momentum in 2025 will be a critical factor shaping the market.

A lack of options – Gold outperformed other alternative assets

Portfolio allocators diversify across multiple asset classes to optimize risk and returns, but in reality, investable options remain limited. Bonds have long been a cornerstone of portfolio construction, and the 60-40 model remains a go-to structure for both individual investors and institutions.

However, with inflation fluctuations and shifting interest rate expectations, bond markets have delivered outsized volatility and uninspiring returns. In response, superannuation firms and institutions have increasingly turned to private equity and unlisted assets, seeking alternative sources of growth. Yet, this segment remains inherently opaque, difficult for the average investor to navigate, and often highly illiquid. Gold, then, stands out as a compelling alternative, and as such it can be expected that the precious metal has starting to command a more prominent allocation in portfolios over the past few years – in turn pushing its price higher.

Commodities in the Era of Trump 2.0

As Trump’s second term unfolds, the market’s initial anxieties and expectations are giving way to a clearer but nonetheless turbulent landscape. While policy shifts continue to create volatility, their impact has been more measured than anticipated, tempering some of the more extreme predictions. Global economic forces, geopolitical developments, and long-term structural trends remain key drivers, shaping both risks and opportunities. Ultimately, while volatility remains a defining feature of the current market environment, these trends offer both risks and opportunities for investors willing to navigate the complexities of Trump’s policy manoeuvres.

Related Fund

Global X Copper Miners ETF (ASX: WIRE) invests in a global basket of copper miners which stand to benefit from being a key part of the value chain facilitating growth in major areas of innovation such as technology, infrastructure and clean energy.

Global X Uranium ETF (ASX: ATOM) invests in a wide range of firms across the uranium value chain including miners, physical uranium, engineering, construction, and SMR designers.

Global X Physical Gold (ASX: GOLD) invests in physical gold via the stock exchange, offering higher liquidity and removing the need for investors to personally store bullion.