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UBS expects copper price to typical $10,500/ T in 2025

UBS stated on Thursday that significantly tighter supplies of copper in the coming six to 12 months might cause a deficit of more than 200,000 loads in 2025, as demand grows for the metal key to energy transition.

Copper costs on the London Metal Exchange (LME) are forecast to typical $10,500 and $11,000 per metric lot in 2025 and 2026, respectively, UBS said.

LME three-month copper struck an intra-day high at $ 9,578 a ton, though it was on track for a regular monthly fall.

We are still positive about copper costs in the coming 2 years ... although rates may welcome some disadvantage pressure in the short-term from the perspective of position holding, Sharon Ding, head of China Basic Materials at UBS, told a. briefing for reporters.

Demand from the new energy vehicles, solar, wind and. China's grid investment stays resilient; and copper is also. taking advantage of high-growth markets such as the data centres. for expert system (AI) and defense needs, Ding included.

Additionally, usage in Europe and the United States is. likely to improve as an easing financial cycle will assist to raise. finance for standard markets such as building and construction,. manufacturing and consumer durables.

That growing need offsets the decline caused by the. property slump in the world's second-largest economy.

Supply, however, is likely to see a decrease by late 2024. or early 2025, as many copper smelters are suffering losses, due. to traditionally low treatment charges (TC).

A key source of income for smelters, TC/RCs are paid by. miners when they offer concentrate, or semi-processed ore, to be. improved into metal.

Ding also forecast typical rates for aluminium and alumina. futures in China at 19,000 yuan a heap and 3,600 a load next year,. respectively.

SHFE alumina futures closed at 4,863 yuan a lot. while aluminium ended at 20,710 yuan on Thursday.

UBS anticipated an excess in China's alumina market in February. 2025 as more supply comes on line, driving down prices.

Alumina rates have actually rallied to a record high this month on. the back of supply interruptions, the latest being export problems. in Guinea, the major source of bauxite imports for China's. alumina refineries.

(source: Reuters)