Bank of America Lifts Long-Term Copper Forecast to $12,000 on Supply Concerns

Bank of America strategists have significantly increased their long-term price forecast for copper by 20% to $12,000 per ton, equivalent to $5.44 per pound. The bank's revised projection, outlined in a recent commodities update report, points to ongoing supply constraints as the primary factor underpinning the metal's expected price strength through 2026.

Supply Issues Drive Upgrade

The forecast adjustment follows what the bank described as more than a year of policy shifts and market surprises. According to the report, persistent challenges in the copper supply chain are expected to maintain upward pressure on prices. This outlook for the key industrial metal remains firm despite broader market volatility.

Bank of America's analysts also highlighted potential headwinds that could impact the forecast. These risks include a possible demand shock triggered by an energy crisis or a slowdown in capital expenditures for data centers, which are significant consumers of copper.

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Adjustments to Other Commodities

While the copper revision was the main focus, the bank made limited changes to its other commodity forecasts. Key adjustments include:

• Aluminum: The 2027 price forecast was lowered by 5% to $3,625 per ton.
• Gold: Strategists noted a bearish outlook for the precious metal, attributing it to the challenging environment of higher interest rates and a stronger U.S. dollar.