Overview
Citi has adopted a more bullish stance on copper after several months of remaining broadly neutral. The bank has raised its near-term price forecast to $14,500 per metric ton and is targeting $15,000 per ton within the next six to twelve months. Citi cites a combination of U.S. tariff-related dynamics, tighter supply expectations and resilient end-use demand related to the energy transition and AI infrastructure as the main justifications for the upgrade.
Tariff dynamics and market positioning
In client communications, analyst Tom Mulqueen noted that Citi expects the copper market to remain supported even if the Strait of Hormuz stays closed through July. The bank says an earlier resolution of the issue would likely boost risk assets further. On the tariff front, Citi wrote that "U.S. copper tariff fears can remain supportive through June," and said it expects U.S. policymakers to maintain strategic ambiguity rather than announce definitive tariffs. According to the bank, that ambiguity is intended to keep surplus copper inventories in the United States and bolster market sentiment ahead of the end-June review deadline.
Supply assumptions
Citi has adopted a more conservative view on copper supply growth. The bank now assumes that both scrap and mine output will underperform through 2026 and 2027. Under these assumptions, Citi projects a market deficit of around 360,000 metric tons in 2027. The tighter supply outlook is presented as a structural support for prices alongside policy-related inventory dynamics.
Demand signals
On the demand side, Citi's proprietary end-use consumption tracker recorded subdued year-on-year growth in March. The bank attributes part of that softness to a high comparison base caused by China front-loading renewable installations in 2025. Nevertheless, Citi points to recent improvements in global manufacturing purchasing managers indices as evidence of potential upside for cyclical consumption, which could further support physical demand for copper.
Risks and caveats
Citi cautioned that copper remains vulnerable to tail risks stemming from a sustained conflict in the Middle East. The bank also warned that after June there is the possibility that tariff risk pricing could fade, which would act as a headwind for prices if neither sustained physical market strength nor a reopening of the Strait of Hormuz materializes as expected.
Reporting note: The views and forecasts summarized here reflect the analysis and client notes distributed by Citi as described above.