Recent Rise Above $11,000 Driven by Sentiment, Limited Upside Says Goldman Sachs
The international copper price recently surpassed $11,000 per ton, sparking market discussions. However, Goldman Sachs cautions in a recent report that this level may be difficult to sustain over the long term.
Analysts note that the current rise is more driven by market sentiment about future supply constraints rather than fundamental changes in current supply and demand. In the short term, copper prices are performing strongly, but the foundation for maintaining high levels is not solid.
Goldman Sachs states that although demand for copper is strong in energy transition, renewable energy equipment, and high-end manufacturing, the actual supply is still notably slack, with high inventory and new capacity constraining prices.
U.S. Import Demand May Temporarily Support, but Long-Term Trend Unaffected
"Rushed Imports" Ahead of Tariff Implementation Support LME Market
The report indicates that with the U.S. policy adjustments on certain metal products approaching, companies are motivated to import earlier, which will provide some support for London Metal Exchange (LME) copper prices over the next three to six months.
However, this support is a temporary factor and cannot change the macro landscape of overall ample supply and limited demand recovery strength.
Analysts add that once the policy effects dissipate, copper prices are likely to return to a fundamentally driven range.
Goldman Raises 2026 Copper Price Forecast, but Still Skeptical of Short-Term Sustained Rise
Long-Term Driven by Energy Transition Demand, Average Price Slightly Lifted
Despite a cautious stance on short-term copper prices, Goldman Sachs has raised its 2026 first-half copper price estimate from $10,415 per ton to $10,710, with the full-year average forecast remaining around $10,650.
This adjustment reflects the resilience of long-term demand, including ongoing global grid investments, electric vehicle supply chain expansion, and renewable energy infrastructure development.
However, Goldman clearly states that with accelerating supply growth, even if copper prices are supported by mid- to long-term structural demand, the rise will be characterized by "slow upward movement rather than a rapid surge".
Significant Supply Expansion Pressure, Various Metals May Face Corrections Next Year
Aluminum, Iron Ore, and Lithium Prices May Be Pressured
Goldman further notes in the report that in addition to copper, various commodities will also be affected by supply growth.
Among them:
- Aluminum prices may weaken due to capacity release and inventory recovery;
- Iron ore faces downside risks against the backdrop of weak global steel demand growth;
- Lithium prices are expected to remain pressured due to new mines starting production and rapid supply expansion.
Analysts believe this assessment reflects a trend of the global commodity market entering a "de-bubbling" stage, where, under the precondition of a moderate global economic recovery pace and limited manufacturing momentum, various raw materials struggle to maintain their previous high prosperity levels.
Divergence Between Sentiment and Reality, Copper Prices to Focus More on Supply and Demand Fundamentals
Overall, Goldman Sachs emphasizes the contrast between current metal price trends and actual supply-demand contradictions. Although the market remains optimistic about future structural demand, the reality of short-term supply abundance means copper prices are unlikely to consistently stay at high levels.
Signs of a moderate adjustment cycle for commodities as a whole are increasingly apparent. The future trajectory of copper and other metal prices will rely on the dynamics of the global macroeconomic environment, industry cycle changes, and policy influences.
