Tariff easing lifts demand expectations for metals: Nirmal Bang

Kunal Shah, Vice President and Head of Commodities Research at Nirmal Bang Securities, said recent tariff adjustments have improved the outlook for key commodity-consuming economies, especially China, leading to stronger demand expectations.

“The big thing is the tariffs have significantly lowered,” he said, adding that China and Brazil are among the economies benefiting from the shift in trade dynamics.

According to him, the improvement in demand visibility has triggered “massive restocking” across the metals market, which is currently supporting prices across industrial commodities.

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He noted that while future policy decisions remain uncertain, current tariff levels have created a supportive environment for commodity demand.

Shah said emerging technology trends are becoming major demand drivers for metals, particularly copper.

He estimates that demand from electric vehicles (EVs), renewable energy and AI-led data centre expansion could increase copper consumption by 3 to 3.5 million tonne over the next three years.

“With concentrated supply not moving up and demand picking up, the fundamentals are very bullish,” he said.

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He added that after precious metals outperformed last year, 2026 could belong to base metals, led by copper, followed by aluminium and zinc.

Shah has revised his long-term copper price target to $16,500–$17,000 per tonne, compared with current levels near $13,000 per tonne.

Apart from demand growth, Shah said supply-side factors are also supporting prices. Smelting capacity curbs in China are tightening refined metal supply at a time when consumption is increasing.

He said aluminium prices could trade at $3,000 per tonne as a base level, with potential upside toward $3,400–$3,500 per tonne driven by tightening supply conditions.

Substitution trends are also emerging, with solar manufacturers shifting toward alternative metals as input costs change, further supporting demand across industrial metals.

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On precious metals, Shah said silver may require fresh industrial demand triggers to sustain a major rally.

He pointed out that, unlike gold, silver lacks consistent central bank buying support, making industrial demand critical for further upside.

“I see stiff resistance for silver near $95 to $100 per ounce,” he said, adding that breakthrough technologies such as advanced battery development could change the demand outlook if commercial adoption occurs.

For the full interview, watch the accompanying video

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