The era of hoarding goods has arrived

Against the backdrop of escalating geopolitical friction and the restructuring of global supply chains, the commodity market is undergoing a profound paradigm shift.

According to Bloomberg, major economies around the world are transitioning from the "just-in-time" supply chain model relied upon for decades to a cost-agnostic "just-in-case" stockpiling model. The core of this shift lies in countries no longer being satisfied with maintaining minimal commercial inventories, but rather beginning to build strategic reserves on a large scale to address potential risks of war, shipping disruptions, or geopolitical blockades. This extreme craving for security is reshaping the supply and demand dynamics of various commodities, from oil to rare metals.

In this trend, energy and strategic metals have become the focus of stockpiling. Michael Haigh, Global Head of Commodity Research at Société Générale, pointed out that some countries may have stockpiled about 1.4 billion barrels of oil, a "huge" scale sufficient to sustain hundreds of days in the event of a complete supply chain disruption, far exceeding the international norm of 90 days. Meanwhile, driven by the "strong security" logic, prices of key military metals such as tungsten and cobalt have experienced significant volatility. According to data from Zhejiang Securities, the price increases for tungsten and cobalt reached 229% and 120%, respectively, by 2025.

Market analysts indicate that this change signifies the establishment of new trading themes for investors. On one hand, there is gold allocation around "de-dollarization," and on the other hand, there is a long logic for metals based on national security needs. As central banks around the world adopt gold as a core tool for hedging credit risk, and with the surge in defense budgets—such as Trump's proposal to increase the U.S. defense budget by 50% to $1.5 trillion—the commodity market is entering a new cycle dominated by geopolitical premiums.

From "Just-in-Time" to "Just-in-Case"

In a global environment of low trust, efficiency has given way to survival. Bloomberg columnist Merryn Somerset Webb pointed out that the days of holding U.S. Treasury bonds, earning interest, and being confident that one could buy needed goods with dollars at any time are over. The current logic is: one must have physical goods, and must have them now.

This logic is particularly evident in oil reserves. Michael Haigh analyzed that some countries may not only possess about 1.4 billion barrels of oil reserves but may even plan to increase it to 2 billion barrels.

The United States is also strengthening its energy security. Despite having a Strategic Petroleum Reserve (SPR) and being a net exporter, the definition of "sufficient" has been rewritten in the face of crisis. The U.S. actions regarding Venezuela and its focus on Greenland's resources reflect an attempt to establish a long-term absolute security advantage by controlling resource origins.

"Strong Security" Logic Reshaping Metal Valuation

The scope of stockpiling has far exceeded the energy sector. If oil is about energy security, then industrial metals and rare earth metals are about economic and national security.

Michael Haigh proposed a key hypothesis: if countries that import nickel, zinc, lead, aluminum, silver, and copper decide to stockpile these metals like they do with oil, prices will "skyrocket." In fact, due to insufficient investment over the past decade, many metal markets are already in a state of deficit Wallstreetcn wrote that the report from Zhejiang Merchants Securities further confirms this trend. The report points out that the strategic stockpiling of materials triggered by "strong security" is driving the revaluation of military metals. From January to November 2025, global base metal prices rose by 15%, but the price increases for varieties closely related to military demand are astonishing:

• Tungsten (armor materials): Up 229%

• Cobalt (drone/exoskeleton energy): Up 120%

• Copper (AI data centers/basic military supplies): Up 42%

In addition to traditional industrial demand, the construction of artificial intelligence infrastructure, the expansion of the power grid, and the surge in defense budgets (the U.S. plans to increase to $1.5 trillion) are exacerbating supply and demand contradictions.

Central Bank Gold Buying Trend and De-dollarization

Beyond physical commodities, the status of gold as a reserve asset is undergoing fundamental changes.

According to Zhejiang Merchants Securities analysis, the global "de-dollarization" process is reshaping the pricing logic of gold. IMF data shows that the dollar's share in global foreign exchange reserves has fallen to 56.92%. Against the backdrop of rising credit risks of U.S. debt and geopolitical sanction risks, central banks around the world are accelerating the shift of reserve assets from dollars to gold.

Michael Haigh pointed out that many central banks aim to increase the proportion of gold reserves to 20%. Currently, most central banks are far from this target. He estimates that if the countries among the top 50 central banks with insufficient reserves increase their gold reserve proportion by just 1%, it would be enough to push gold prices up by about $1,000.

Zhejiang Merchants Securities believes that the pricing logic of gold has shifted from being traditionally driven by real interest rates to being dominated by official sector demand and geopolitical risk premiums. 95% of surveyed central banks expect to continue increasing their gold holdings, which forms the cornerstone of the medium to long-term upward trend in gold prices.

What Does This Mean for the Market?

For the market, this shift in macro narrative has direct investment implications.

Bloomberg suggests that investors do not need to personally engage in complex physical stockpiling but should pay attention to related capital market opportunities. European defense stocks and commodity ETFs are effective tools for achieving diversification. Notably, the FTSE 100 index recently reached the 10,000-point mark, primarily composed of mining, oil companies, and defense stocks, confirming that market funds are flowing into "hard assets."

In contrast, former tech darling Nvidia is expected to underperform various mining stocks in 2025, with its stock price down nearly 10% from its peak. This indicates that market styles may be shifting.

Additionally, gold mining stocks are also beneficiaries. All 313 gold miners tracked by Wood Mackenzie are currently setting profit records at the current gold price. Zhejiang Merchants Securities suggests that investors should focus on gold with independent value storage functions, as well as key metals closely related to military demand but less affected by the real estate cycle