Copper prices have strongly broken through $13,000, raising the "short-term target," but this investment bank believes January may be the high point for the year!

Copper prices have recently rebounded strongly and broken through key resistance levels, prompting Citi to raise its short-term price targets. However, in its latest report, the bank warns that the current rally may soon run out of steam, and January may become the high for copper prices for all of 2026, after which the market could face downside risks. According to WindChaser Trading Desk, Citi’s research report released on January 6 shows that the rapid rise in copper prices has broken through the bank’s previous annual outlook targets of $12,000 per ton for 0-3 months and $13,000 per ton for 6-12 months set for 2026. **Based on market momentum, positioning room, and US tariff dynamics, Citi has decided to “tactically” remain bullish, raising the 0-3 month price target to $14,000 per ton.** However, this optimism comes with caveats. The analyst team led by Tom Mulqueen and Maximilian J Layton frankly states: > “Although we have raised our short-term target, our conviction in the current bullish price is far lower than in December; January could well be the 2026 price peak. Unless new catalysts emerge to realize our bullish scenario of $15,000 per ton, we expect prices to eventually fall back to a more sustainable level of $13,000 per ton.” **One of the main drivers of this rally is arbitrage activity and tariff expectations surrounding the US market.** Bill of lading data shows that in late December, US copper imports surged to multi-year highs, and COMEX copper continues to trade at a premium to LME copper. The market is pricing in tariff risks lasting through June, supporting pricing and spreads outside the US. Citi’s base case is that, although the market is trading tariff risk, ultimately substantive US refined copper tariffs may not materialize or may be mitigated through exemptions for partners such as Chile. However, until then, this uncertainty remains fuel for the bulls. For fundamental investors, supply-side reaction cannot be ignored. **Citi warns that the current price level of $13,000 per ton is already sufficient to stimulate increased scrap copper recycling (and substitution effects), which will bring the global physical copper market back into balance by 2026:** > “We believe that further gains above $13,000 per ton will eventually be given back by the market. High prices could trigger bearish physical signals, such as increased inventory visibility and availability.” Although the baseline forecast is for a pullback, Citi also maintains a 20% probability “bullish scenario” in which copper prices surge to $15,000 per ton. But this would require a series of perfect macro factors: investors aggressively pricing in an “extremely soft landing” for the US economy, further weakening of the US dollar, the Fed cutting rates much further to trigger a cyclical recovery, or unexpected supply shocks (such as mine supply issues or scrap copper being slow to respond to higher prices). Until these new catalysts emerge, investors may need to beware: January’s exuberance could be the annual peak. ~~~~~~~~~~~~~~~~~~~~~~~~ The above highlights are from [WindChaser Trading Desk](https://mp.weixin.qq.com/s/uua05g5qk-N2J7h91pyqxQ). For a more detailed analysis, including real-time interpretations and front-line research, please join the [**WindChaser Trading Desk ▪ Annual Membership**](https://wallstreetcn.com/shop/item/1000309). [](https://wallstreetcn.com/shop/item/1000309) Risk Warning and Disclaimer The market has risks, and investment needs to be approached with caution. This article does not constitute personal investment advice, nor does it take into account the special investment goals, financial circumstances, or needs of individual users. Users should consider whether any opinions, viewpoints, or conclusions contained herein are appropriate for their specific circumstances. Invest accordingly, at your own risk.