Base Metal Fundamental Outlook

Advisory Bazaar Info Services LLP

Copper

The US-Iran conflict has eased for now, but the risk of renewed geopolitical tensions remains. Market participants are closely watching Wednesday’s US Federal Reserve policy meeting, resulting in a cautious trading environment and range-bound copper prices. On the supply side, cargoes with next month’s invoices were relatively abundant, while current-month cargoes remained comparatively tight. Recent price corrections have also improved downstream buying interest.

Outlook: Copper prices are expected to trade sideways with a slight negative bias as investors await the Fed’s policy decision.

Aluminium

Aluminium prices continue to receive support from persistent Middle East geopolitical risks and the ongoing decline in domestic aluminium ingot inventories. However, expanding overseas production capacity, weak seasonal demand in China, expectations of tighter US monetary policy, and geopolitical uncertainty continue to limit the upside.

Outlook: Aluminium prices are likely to remain range-bound in the short term.

Lead

Global macroeconomic signals remain mixed, with investors awaiting the outcome of the US Federal Reserve meeting for further direction. In China, secondary lead smelters are facing losses and considering production cuts, while primary smelters are increasing maintenance, which could ease inventory pressure. Producers continue to resist selling at lower prices, and narrowing spot discounts are providing support. However, downstream demand remains subdued, with buyers continuing to procure only on a need-based basis.

Outlook: Lead prices are expected to consolidate within a narrow range in the near term.

Zinc

LME zinc weakened overnight but found support from its 40-day and 60-day moving averages. Although inventories outside China continue to decline, ongoing geopolitical uncertainty and weak end-user demand remain key concerns. Tight zinc ore supply continues to provide fundamental support to prices despite elevated social inventories.

Outlook: Zinc prices are expected to remain firm and consolidate at higher levels due to constrained raw material supply.

Tin

The average SMM 1# tin price declined by 6,350 yuan/mt to 412,900 yuan/mt. Smelters maintained firm offers but limited shipments, while traders slightly reduced premiums. High prices kept downstream buyers cautious, leading to slower procurement and weaker spot transactions. Nevertheless, the market continues to be supported by tight ore supply, limited refined tin availability, and low inventories.

Outlook: If the SHFE 2609 contract corrects toward the 400,000–402,000 yuan/mt range, selective restocking demand is likely to emerge from downstream consumers.