Reuters reported that copper prices are expected to fall this year as supply rises at a faster pace than demand, while the market balance for aluminium is expected to tighten significantly due to production cutbacks.

The 26 analysts in the poll cut the median 2014 forecasts for copper, aluminium and lead from their January estimates. They raised their forecasts for nickel prices by 5% however, in the biggest revision out of all the metals.

Mr Marc Elliott an analyst at Investec said that “Cash copper prices are forecast to average USD 6,816.50 per tonne this year, revised lower from the January forecast of USD 7,013 and also down nearly 7% from the 2013 average price. They are forecast at USD 6,839 per tonne for 2015. Demand in China, the world's top copper consumer, is likely to be subdued.”

He said that "The copper surplus will probably widen in the second half as demand eases back following the peak industrial period in China that's typically a spring or early summer phenomenon. The copper market is expected to be in a 228,000 tonne surplus by the end of 2014, compared with an estimate of 260,500 tonnes in the previous poll, and rise to 262,000 tonnes in 2015.”

According to 24 analysts, in aluminium, the market balance is expected to tighten significantly to a 68,107 tonne surplus, compared with an oversupply of 568,400 predicted in the previous poll. Cash aluminium prices are seen averaging USD 1,792.50 a tonne this year down from previous forecasts of USD 1,840 and lower than the average 2013 cash price of USD 1,844.95. It is expected to rise again to USD 1,950 in 2015.

Standard Bank said that aluminium is slowly tightening up, with producers going through the painful industry restructuring activity that should have taken place back in 2009 to 2010. However, it is too soon to get bullish as stock overhang remains.

Low aluminium prices have prompted cutbacks including from US producer Alcoa, which shut down 147,000 tonnes in Brazil. China, which accounts for as much as 40% of global demand for refined copper, is forecast to post its slowest economic growth rate in five years in the first quarter and that weak tart to 2014 has already prompted government action.

Three month London Metal Exchange copper fell to 3-1/2-year lows below USD 7,000 per tonne in March on concerns that a credit crisis in China could force an unravelling of financing deals that have locked up vast quantities of metal. Copper closed at USD 6,667 per tonne on Monday.

Ms Caroline Bain senior commodities economist at Capital Economics said that "A significant source of import demand in recent months has been copper for financing deals. We expect this activity to slow or stall. Physical demand could also slow if Chinese manufacturing companies struggle to obtain credit or trade financing.”