LONDON: Prices of copper and aluminium rose on Tuesday as economic stimulus measures by top metals consumer China spurred a recovery after a bout of profit-taking drove both metals to losses in the previous session.
Three-month copper on the London Metal Exchange (LME) rose 0.7% to $9,898.50 a metric ton by 1017 GMT while aluminium gained 0.9% to $2,636.50.
China introduced a series of supportive measures before the start of China’s Oct. 1-7 holiday, including liquidity injection, mortgage rate cuts and an easing of home purchase curbs.
Prices for copper are expected to average $10,750 a ton in 2025 and $12,000 in 2026, against an expectations of $9,432 this year, BofA Securities analysts said in a note, adding that its projections for aluminium were $3,000 in 2025, $3,250 in 2026 and $2,471 this year.
China stimulus propels London copper, zinc to around 4-month highs
For copper, used in power and construction, China’s grid spending has offset weakness in the housing sector while demand outside China should recover as economics conditions improve.
For aluminium, used in the construction, transportation and packaging sectors, the market is expected to tighten as demand rises outside China, BofA said, adding that demand within China remains strong as smelters struggle to contend with hydropower shortages.
Indicating tighter supplies in the near-term, the discount for LME cash aluminium to the three-month contract reached $2.80 a ton on Monday, its lowest since late April.
In other metals, LME zinc added 1.2% to $3,127.50 a ton, lead climbed 1.1% to $2,118.50, tin was steady at $33,430 and nickel advanced 1.4% to $17,765.
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