Against the backdrop of geopolitical shocks and macroeconomic headwinds, is the traditional "golden three, silver four" peak season for base metals in 2026 looking lackluster?

(Source: Yangtze Nickel Industry Network)

The traditional peak season of “Golden March and Silver April” in 2026 is facing unprecedented complex macro and geopolitical environments. On one side, the demand validation window brought by the acceleration of manufacturing resumption; on the other side, the triple pressures of renewed Middle East conflicts, the Fed’s hawkish shift, and high inventory pressures. The market generally worries whether this peak season will “fizzle out,” but amid fierce battles between bulls and bears, the era of widespread gains has ended, and structural differentiation will become the only main theme of this round of market.

1. Macro Headwinds: From “Liquidity Feast” to “Safe-Haven and Tightening” Double Kill

This year’s macro environment is vastly different from previous years. The hawkish signals from the Fed’s March meeting pushed the full-year rate cut expectations down to just one, delayed until September, and even reignited discussions of rate hikes. The strengthening dollar index directly suppressed the valuation of dollar-denominated commodities, leading to capital withdrawal from risk assets, as evidenced by continuous declines in U.S. stocks.

More severe is the escalation of Middle East geopolitical tensions. Military threats from the U.S. and Israel against Iran and the navigation risks in the Strait of Hormuz have pushed up crude oil prices but also triggered deep fears of “stagflation.” High oil prices transmit through supply chains to global inflation, further constraining monetary easing space. For the metals market, this means a sharp contraction of “financial attributes.” Any varieties lacking solid fundamentals, under the dual blow of high dollar and tightening liquidity, are highly prone to underperformance.

2. Supply and Demand Game: “Fake and Real Peak Season” Under High Inventory Pressure

Market concerns that “Golden March and Silver April” will fizzle out hinge on the contradiction between high inventories and weak fundamentals.

Inventory Pressure: Whether copper, aluminum, or zinc, the accumulated inventories are at relatively high levels historically. For example, LME copper warehouse stocks hit multi-year highs, and domestic aluminum social inventories are also near recent peaks. In the traditional destocking season, if inventory reduction is slower than expected, it will disprove the “peak season” logic.

Demand Quality: Although the start-up rates in new energy, power grid, and infrastructure sectors have rebounded, high metal prices have somewhat suppressed downstream procurement willingness. Some processing enterprises are cautious, mainly replenishing just-needed stocks, with significantly reduced speculative stocking.

Therefore, this year’s peak season is not “demand explosion,” but “demand recovery.” If existing inventories cannot be quickly digested through strong terminal consumption, price upside will be strictly capped.

3. Breakthrough Path: Structural Market Is the Only Way Out

Under macro headwinds and high inventory pressures, a full-blown bull market is unlikely. However, rigid supply-side constraints will provide some varieties with logic to break out independently.

Copper: The “King” of Supply-Demand Balance

Despite macro pressures, copper’s fundamentals are the strongest. Global copper mine supply is tightening, processing fees (TC) remain low or even negative, prompting expectations of reduced smelting output. Coupled with long-term demand growth from AI computing centers, power grid upgrades, and new energy vehicles, the supply-demand gap is certain. Strategically, after a macro sentiment overreaction and correction, copper prices present a good medium- to long-term layout opportunity. The trend will show a “macro pressure, fundamental support” oscillating upward.

Aluminum: “Geopolitical Disruption and Cost Support” Dual Drive

Aluminum logic is “external tightening, internal stability.” Middle East conflicts threaten overseas electrolytic aluminum capacity and energy supply, while rising domestic alumina prices provide solid cost support. Although domestic inventories are high, orders from photovoltaic and automotive lightweighting are expected to accelerate destocking in the latter half of the peak season. Aluminum prices are more likely to fluctuate at high levels, with downside supported by costs and upside driven by geopolitical premiums.

Other Varieties: Increasing Differentiation

Nickel: Affected by sudden policy changes in Indonesia, there is a rebound opportunity from oversold levels, but long-term supply release pressures warrant caution, suitable for swing trading.

Zinc/Lead: Due to overseas mine disruptions not transmitted domestically and weak demand, under macro negative factors, they are likely to remain weak and range-bound, with little trend-driven rally.

4. Conclusion and Outlook: Not Completely “Fizzle Out,” But Not “Widespread Gains” Either

This year’s “Golden March and Silver April” will not completely fizzle out, but its quality will be significantly reduced. The market will shift from the past “beta-driven” (rising with macro trends) to “alpha-driven” (independent logic of individual stocks/varieties).

1. Trend Judgment: Expect intense shakeouts. Initially, macro fears and profit-taking may pressure metals prices; subsequently, varieties with supply constraints (like copper, aluminum) will stabilize and attempt to break out, while those with ample supply and weak demand will continue to bottom out.

2. Investment Advice: Abandon the mindset of “long all metals.”

3. Long Positions: Focus on supply-demand tight varieties like copper and aluminum, and use macro-induced sharp declines to build positions gradually.

4. Risk Management: Be cautious with high-inventory, demand-elastic varieties, and beware of further declines under macro negative conditions.

5. Key Indicators: Closely monitor weekly inventory reduction rates and downstream operating rates. Only when inventories show substantial and continuous decline can the true start of the peak season rally be confirmed.

In summary, in 2026, non-ferrous metals will show wide oscillations amid geopolitical shocks and macro tightening. Whether they can develop independent trending markets remains to be seen, awaiting the results of the “Golden March and Silver April” peak season.

Note: The opinions expressed in this article are personal views only and do not constitute recommendations. Trading based on these opinions is at your own risk.