Copper rises on track for seventh monthly profit in row

Copper prices rose during Friday’s trading, heading toward a seventh consecutive month of gains, supported by optimism surrounding global demand growth.

The most-active copper futures contract on the London Metal Exchange climbed 1.3% to $13,478 per ton at 01:47 p.m. Makkah time, after touching its highest level since February 4 at $13,496 per ton.

Data released after the Lunar New Year holiday in China showed copper inventories in Shanghai Futures Exchange warehouses rising to their highest level in nearly 10 years, reaching 391.5 thousand tons, up 44% from levels seen two weeks earlier.

UBS raised its copper price forecasts by $500 per metric ton across all time horizons, projecting prices could reach $15,000 per metric ton by the end of March 2027. The bank maintained its positive outlook, recommending that investors keep long-term long positions in the industrial metal.

The investment bank expects copper prices to rise on a yearly basis despite caution in the near term. The recent price rally has paused temporarily, with elevated levels expected to persist through 2026, while seasonal economic slowdown around the Chinese Lunar New Year contributed to a period of price consolidation.

Supply and demand forecast revision

UBS updated its supply and demand forecasts based on the latest available data. The bank now expects a slightly smaller supply deficit in 2025 of around 200,000 metric tons, compared with a previous estimate of 230,000 tons.

At the same time, it raised its forecast for the 2026 supply deficit to 520,000 metric tons, up from a prior estimate of 407,000 tons. The widening supply gap remains one of the key factors supporting a bullish medium-term outlook for copper prices.

The bank reaffirmed its recommendation for clients to maintain long positions in copper based on revised supply-demand fundamentals, noting that its updated outlook implies prices will stay elevated throughout 2026.

Decline in Chilean output

On the production side, data from Chile’s national statistics agency showed that copper output in the world’s largest producer declined 3% year-on-year in January to 413,712 metric tons.

Industrial production in the Andes nation also fell 3.8% during the same month compared with a year earlier, indicating continued pressure on the global supply side of the metal.

In US trading hours, May copper futures were up 1.2% by 16:00 GMT at $6.07 per pound.