China’s Guangzhou Futures Exchange (GFEX) on Thursday set new limits on platinum and palladium trading that will take effect on December 29, according to a notice today.

The change applies to platinum contracts PT2606, PT2608, PT2610, PT2612 and palladium contracts PD2606, PD2608, PD2610, PD2612, according to the exchange.

Platinum prices hit an all-time high last week at $2,377.50 before pulling back, then later traded 2.4% lower at $2,220.44. Palladium fell even harder, dropping more than 9% to $1,683.58 after touching its highest level in three years earlier in the session. Both metals remain sharply higher on the year. Platinum is up about 145%, while palladium has gained more than 85%.

Chinese spot and futures markets for precious metals have also traded at persistent premiums compared with London and COMEX prices, which have held even as global prices rallied.

Silver surge and fund losses are the basis of China’s current market stress

The GFEX decision landed as silver trading in China turned chaotic. Shanghai silver prices hit a record $80 per ounce, pushing year-to-date gains above 150%. Traders have pointed to a shortage of physical silver inside China. Globally, spot silver hovered near $72 per ounce, extending a rally that has lifted prices more than 120% in 2025. On Wednesday, spot silver reached $72.70, putting it on track for its best annual performance since 1979.

Gold has surged by 60% year-to-date.

China’s only pure-play silver fund, the UBS SDIC Silver Futures Fund LOF, dropped by its maximum daily limit of 10% on Thursday. The fall ended a rapid rally that had triggered repeated warnings from the fund manager.

The fund had risen nearly 220% this year, far outpacing the roughly 128% gain in Shanghai silver futures. By Wednesday, the premium over the fund’s underlying silver contracts stood at nearly 62%, up from 7% at the start of the month.

After three straight days of hitting its 10% daily upside limit, the firm cut Class C subscription limits to 100 yuan from 500 yuan, effective December 26.

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