Tight Copper and Aluminium Supply Keeps Metals Outlook Firm Into 2026

ING

Tight copper and aluminium supply is shaping the metals outlook into 2026. ING expects both markets to stay well supported. Copper remains constrained by mine underperformance and disrupted trade flows. Meanwhile, aluminium faces limited supply growth and rising competition for power.

Copper market tightness has extended from 2025 into 2026. ING said operational disruptions and weak mine performance continue to limit supply. Environmental rules, land-use restrictions, and permitting delays add further pressure. As a result, the market still lacks enough new metal outside the United States.

US trade policy is also distorting physical flows. Uncertainty over refined copper tariffs has pulled metal into the US market. ING said this has effectively turned US inventories into a strategic reserve. Therefore, regions outside the US remain tighter than headline stock data suggests.

Copper Market Tightness Still Depends on Supply Constraints and China Demand

Copper market tightness is not being solved by high prices. ING said most spending supports delayed projects or offsets declining ore grades. Very little capital is moving into major greenfield developments. Consequently, current prices cannot fix near-term supply deficits.

Long-term copper demand still looks strong. Grid investment, renewable energy expansion, electrification, and data centre growth support multi-year consumption. However, ING sees China as the main downside risk. Without stronger Chinese buying, copper prices could face sharper corrections.

This imbalance is also driving dealmaking across the mining sector. High prices are encouraging mergers and acquisitions rather than greenfield investment. Producers and investors want near-term output, not distant optionality. Therefore, existing assets now look more strategic than undeveloped projects.

Aluminium Market Deficit Could Deepen as Power Competition Intensifies

Aluminium is also moving toward a tighter structural balance. ING expects a clear aluminium market deficit in 2026. Supply growth outside Indonesia remains limited, while China has kept capacity additions disciplined. As a result, the market may tighten further even without a demand surge.

Energy costs remain the biggest constraint for aluminium supply. High power prices still block meaningful smelter restarts in Europe and the United States. ING also highlighted growing competition from AI-driven data centres. Those facilities can outbid aluminium smelters for long-term electricity contracts.

Demand, however, remains resilient across key end markets. Packaging, transport, construction, and renewable energy continue to support aluminium consumption. Copper substitution in wiring and cables is adding further upside. Therefore, aluminium prices could keep rising if supply stays constrained.

The Metalnomist Commentary

Copper and aluminium now share the same deeper problem. High prices are not producing enough fast supply. That makes policy, power access, and project timing more important than headline demand alone.