Citigroup said London Metal Exchange Week participants were generally cautious on the industrial metals outlook, citing weak growth, AI risks, high energy prices, supply growth, and US copper tariff disappointment.
Citi said it remains neutral on copper until there is greater clarity on energy markets and US tariff policy.
“US tariff uncertainty is still seen as the biggest positioning and price risk,” it added.
The bank said aluminium attracted the most negative sentiment among LME Week participants, with concerns over a potential 1-2 million tonnes surplus in 2027 from strong Indonesia-led supply growth and a muted demand outlook.
Citi said it sees 6-12 month upside to US$60,000 ($85,348) per tonne for tin in its base case and US$70,000 per tonne in its bull case.
The bank said it views sub-US$16,000 per tonne nickel as offering attractive upside potential if Indonesian supply growth is constrained.
Citi said it was generally cautious on metals on geopolitical risks ahead of the Israeli and US elections, but could turn more optimistic if a US-Iran deal is reached by year-end.
LME copper rose 1.8% to US$14,334 a tonne, while aluminium gained 1.2% to US$3,044, and tin rose 1.2% to US$50,700 by 16:15 GMT on Friday.
(Reporting by Vedika Thorat in Bengaluru; Editing by Daniel Wallis)
Image: CRU Group
