TD Securities has cut its aluminium price forecasts as the metal market heads toward rebalancing after recent supply pressures ease and demand weakens. The investment bank now projects aluminium to average 3,378 dollars per tonne in 2026, followed by 3,281 dollars per tonne in 2027, reflecting expectations of smaller market deficits ahead.
The downgrade comes as supply conditions normalize following disruptions that had tightened the market in recent months. Simultaneously, softening demand is removing upward pressure on prices. Despite the bearish revision, TD Securities strategists emphasize they are not forecasting a significant price collapse, suggesting the market will find equilibrium rather than experience a dramatic selloff.
The revised outlook affects aluminium producers, industrial consumers, and commodities traders who have positioned for tighter market conditions. Derivatives linked to base metals may see volatility as market participants adjust expectations around supply-demand dynamics through 2027.
FXnCO Insight
Traders should consider reducing long aluminium positions and reassessing exposure to industrial metals as the rebalancing thesis gains traction among major forecasters.
Source: FXStreet