Silver to Copper: Strategic hoarding redraws commodity maps – TDS

Under the hood, raw materials ranging from Silver, platinum and Copper have priced in extreme scarcity over the last months, TDS' Senior Commodity Strategist Daniel Ghali notes.

Metals reveal a fragmenting global inventory

"Themes ranging from Silver's illusion of liquidity, the ongoing platinum-squeeze, and the historic squeeze on LME Copper all share a common thread. A separate mega-theme is emerging: we think global inventory systems are at least partially fragmenting."

"This emerging theme was likely catalyzed by the trade war, which has inadvertently fueled a tidal wave of metal flows into the US and simultaneously a stockpiling impulse in China, draining the global pool of inventories available for purchase."

"These inventories are unlikely to make their way back into the system due to (1) the financialization of real assets, which inhibits metal outflows from the US, and (2) Chinese stockpiling which exhibited some strategic hues. The US-China détente on trade conceals the fact that the world's two largest economies are effectively competing for raw materials. This is fundamentally bullish."