As President Trump’s tariffs continue to disrupt key commodity markets, our team discusses what this heightened commodity price volatility means for metal, agricultural, chemical, and resin prices in the second half of 2025.
How is volatility continuing to affect the global commodity markets?
The first half of 2025 saw large swings in commodity prices, driven by supply disruptions, policy shocks, and big shifts in macroeconomic forces. Tariffs enacted by US President Donald Trump affect nearly all goods imported into the US, including a 50% tariff on steel and aluminium, a 25% tariff on imported cars, and a 50% tariff on copper – adding to ongoing commodity market volatility. And more announcements for other sectors may come later in the year.
Beyond tariffs, the climate has also caused disruptions to the agricultural sector. Flooding in Southeast Asia, record-breaking temperatures in Europe, and an increase in drought conditions have damaged plantations, impacted wheat and corn yields, and affected livestock and dairy production.
And if that wasn’t enough, the escalation of tensions between Iran and Israel in June created a risk premium in the region’s oil and gold industry, compounding global commodity price volatility.
In the latest edition of our Commodity in Focus series, WNS Procurement’s Nishita Sharma, Vivek Aggarwal, Nidhi Jain, Rohan Gupta, and Shruti Pathak came together to talk through it all, and answer the question: What does all this commodities volatility mean for the second half of 2025?
Watch the full session on demand to dive into the detail, or read on to explore the main takeaways.
Market outlook for the second half of 2025
Given current commodity price volatility, it’s hardly surprising that the outlook for the second half of 2025 varies greatly across different commodities. Therefore, the team broke down their predictions for what’s next into four key categories.
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Metals
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Aluminium
Continued low inventory levels across LMS and SHFE warehouses mean that prices for aluminium are likely to rise. LME aluminium prices are expected to fall in the range of $2,500 to $2,700 per ton in the second half of 2025, about 2-3% higher on average than in 2025’s first half.
The US tariffs on metals are already impacting aluminium imports, particularly from Canada, with some major Canadian aluminium producers already diverting around 100,000 tons of aluminium away from the US market. These supply concerns mean the Midways premium is expected to remain at a record high. However, as this premium begins to weigh on US demand, it could potentially soften by the end of the year.
As prices are expected to recover, we recommend avoiding excessive stockpiling of aluminium and instead opting for need-based buying in the short term while you wait for premiums to fall.
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Copper
The price of copper is also high, surging to about $2,500 per ton over the past six-months, significantly above the usual $250 per ton, ahead of the potential imposition of copper-specific tariffs by the US. This ongoing commodity market volatility makes it prudent for buyers to lock in their copper requirements for the first half of 2026 in August, before prices climb further due to supply constraints.
We recommend buyers lock in their copper requirements for the first half of 2026 in August itself, before prices climb further due to supply constraint.
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Steel
Unsurprisingly, steel prices also rose dramatically in the US in the first half of 2025, driven by a 25% tariff on all steel imports by the US, which was further increased to 50% in June. This caused buyers to up their purchase rates in anticipation of further trade restrictions being announced.
Prices should trend downwards over the next few months in line with muted downstream demand and the rise in domestic supply. A reduced steel tariff on the UK and likely exemptions of steel imports to The EU should encourage prices to drop further.
It’s therefore advisable to procure your steel requirements for first six months of 2026 in October 2025. After that, iron ore prices will likely rise and buying sentiments will improve – causing prices to increase once again and potentially reigniting commodities volatility.
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Grains and vegetable oils
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Wheat
Wheat prices in the US are expected to remain soft through the second half of 2025 driven by ample supplies. And high carryover stocks from last year mean the stock to use ratio for wheat will be boosted to 44% in the US during the marketing year 25/26. Additionally, European wheat output is set to rise 12% during the same period.
However, weather-related concerns persist in Ukraine, China and southern Australia, constraining supply from those regions. The global surplus outlook and the competition from low-cost origins will likely cap US prices in the range of $0.055 to $0.06 per bushel for the second half of 2025. Therefore, we recommend avoiding overbuying now and waiting for the prices to bottom out amid commodity price volatility.
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Corn
Global corn supplies are projected to remain ample throughout the marketing year 25/26, with output forecast to rise 3.1% year over year. In the US, the corn output is projected to increase 5.6% over the same period, driven by higher rains, accelerated sowing, and a drop in exports. This will be the largest crop on record.
The price is expected to remain weak in the range of $3.6 to $4.2 per bushel. So, procurement for the second half of 2026 can be optimally timed at late quarter three of 2025.
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Oil
Palm oil prices are expected to remain elevated through second half of 2025, supported by policy-driven demand and tight stock levels. And in Europe, the upcoming European Union deforestation regulation, effective January 2026, is triggering pre-emptive buying, adding short-term upside pressure.
Buyers are, therefore, advised to delay their procurement until late quarter three of 2025 when seasonal production improves and demand from India and China eases.
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Chemicals
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Methanol
During the first half of the year, methanol prices in North America and Europe experienced a substantial decline from peak levels in the fourth quarter of 2024. And prices in the US and Europe are expected to remain subdued in the second half of the year, driven by reduced demand from the construction and automotive sectors.
We suggest that buyers should cover their requirements for the first half of 2026 by the end of quarter three. Prices could begin to recover from the fourth quarter, driven by increase in feedstock prices and emerging commodities volatility.
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Resins
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Virgin resins
We expect that in the second half of 2025 prices for HDP and PP will drop compared to the first half of 2025. The uncertainty regarding US tariffs has severely impacted the demand environment. Consumer spending sentiment is down, particularly in the automotive, construction, and packaging sectors – which are significant demand sectors for many ethylene and propylene derivatives.
Prices for PT and PVC are also expected to drop in the second half of 2025.
It’s recommended for buyers to avoid stocking up right now, instead, build stocks during quarter four of 2025, as prices may start to rise from beginning of 2026 amid seasonal plant turnarounds.
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Recycled resins
The recycled HDP market is under pressure, driven by weakened demand and an oversupply of material. In response, producers have scaled back production to control inventory levels, which has negatively affected profit margins. What’s more, price gap between virgin and recycled plastics is narrowing, prompting many buyers to choose the more cost effective virgin alternatives.
Get the insight you need to face the changing market
The continued impact of tariffs, a changing climate, and geopolitical disruption will continue to shape the global procurement outlook throughout the second half of 2025 and beyond. So it’s vital you stay aware of developments as they happen, and build your understanding of what they could mean for your sector.
Timely and reliable market insights can help organizations respond effectively to commodity price volatility and make proactive decisions based on comprehensive intelligence. That’s exactly what WNS Procurement offers.
Watch the full on-demand webinar for even more detail into the commodity market outlook for the second half of 2025.
Watch the webinar