Goldman Sachs: Expects copper demand to slow down, lowers average price forecast to $12,650 per ton.

Goldman Sachs released a research report stating that the global copper market is expected to have an excess supply of 490,000 tons this year (previously forecasted at 380,000 tons), and predicted the average price of copper this year to be $12,650 per ton (previously forecasted at $12,850, with futures prices at $12,500). Goldman Sachs' operating rule is that for every 1 percentage point slowdown in global real GDP growth, global copper demand growth will slow by about 0.9 percentage points. Therefore, the bank's economists, based on a basic scenario where energy price shocks have a 0.4 percentage point impact on global GDP growth, have lowered their forecast for global refined copper demand growth to a year-on-year increase of 1.6% (previously 2%). This downward revision is smaller than that of aluminum, because copper demand is becoming increasingly strategic and structural, reducing its sensitivity to the global economic cycle. In the short term, Goldman Sachs expects copper prices to remain volatile, as the market continues to assess the impact of events in the Middle East on global economic growth. In the bank's basic scenario, where energy transport through the Strait of Hormuz resumes in mid-April, it is expected that risk assets, including copper, will receive support. Additionally, the bank's economists still anticipate the Federal Reserve to cut interest rates by 25 basis points in September and December, while the market prices in no rate cuts this year, which also supports risk assets. Therefore, Goldman Sachs predicts the average copper price for the second quarter of 2026 to be $12,700 per ton, as speculative positions may recover in this basic scenario. However, the bank maintains the mid-term view that prices will slightly fall to $12,000 per ton in the second half of 2026. Looking beyond the next two years, the bank maintains its view that copper prices will rise to $15,000 per ton by 2035, and recent events in the Middle East may further strengthen the electrification theme (due to increasing reliance on grid systems for national defense and energy security), boosting copper demand growth.