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Commodities

Base Metals See Mixed Outlook Amid Supply and Tariff Uncertainties

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Copper
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LME Week 2026 kicked off in London with industry leaders focusing on the macroeconomic outlook for base metals, AI demand, and energy transition. The London Metal Exchange reported a 16% year-on-year increase in average daily turnover from January through September, reflecting robust health. Standard Chartered's commodity analysts predict mixed results for base metals, driven by macroeconomic conditions, geopolitics, and supply uncertainties.

Copper prices are expected to remain elevated through 2026, supported by supply stresses and U.S. tariff uncertainty. Standard Chartered upgraded its average copper price forecast to $13,674 per ton in 2026 and $13,210 per ton in 2027. Copper prices have surged 16% year-to-date, with supply disruptions and macroeconomic factors playing key roles. The analysts highlight the uncertainty over U.S. copper tariffs and intensifying supply issues as major drivers.

Aluminium prices have given up their war premium, with forecasts lowered due to improved supply prospects. Standard Chartered now expects prices to average $3,249 per ton in 2026 and $3,001 per ton in 2027. The drop in prices reflects a faster-than-expected recovery of Middle East supply, increased Indonesian output, and robust Chinese production. However, full resumption of GCC supply remains uncertain.

Zinc prices have been adjusted higher, with forecasts at $3,555 per ton in 2026 and $3,476 per ton in 2027. Supply underperformance is expected to buffer downside risks, with a tight zinc concentrate market and constrained smelter supply. Nickel price forecasts have been tweaked lower, with prices influenced by Indonesia's nickel policy and soft demand from key sectors.

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