Analysts say aluminium and copper have limited room to fall on fundamentals
AI Market Summary
Analysts argue aluminium and copper downside is limited despite recent declines, citing persistent supply deficits driven by Middle East capacity outages and still-tight inventories. Even with improved geopolitics, lost output is unlikely to return quickly, while Chinese destocking and downstream restocking signal resilient demand. The news supports a firmer near-term tone for industrial metals, with aluminium most directly linked to the cited 1.8mt deficit.
Impact level
● Medium
Affected assets
NCCOALUMINIUM2USD/USDT+0.53%
AI Insight · NCCOALUMINIUM2USD/USDTAI Insight
▲ Bullish
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As of July 2, 2026, aluminium on the London Metal Exchange was quoted at $3,100 a tonne, up 3% year to date, while copper stood at $13,300 a tonne, up 7.5% year to date. Several institutions said the US-Iran conflict has effectively removed about 3 million tonnes of aluminium capacity and 2.3 million tonnes of copper capacity from the market, leaving a 1.8 million-tonne aluminium supply deficit and a tightening copper supply backdrop. They added that even as geopolitical tensions ease, the lost capacity is unlikely to return quickly, and rapid destocking and broad-based restocking by downstream users in China are expected to underpin a price rebound.
