Fitch Solutions Country Risk and Industry Research, a unit of Fitch Group, has published its ‘Outlook for Metals’ report, which maintains its core view for metal prices to head slightly higher this year in general compared with 2019.

It expects to see a recovery in metals prices by the second half of this year, as the novel coronavirus (2019-nCoV) epidemic eases and the Chinese government steps up fiscal support measures to cushion the impact of the coronavirus on economic growth.

However, the balance of risks in the 2020 price forecasts is tilted to the downside, as a prolonged spread of the coronavirus could push metals below key levels of support, which will prompt it to review its forecasts.

As China is the largest consumer of metals, continued negative investor sentiment and dampening of physical demand for metals will not bode well for the complex, Fitch asserted.

For copper, Fitch is looking to revise upwards its current price forecast of $5 700/t for 2020 as fundamentals remain tight while decreasing risks of recession and improving global macroeconomic data will strengthen investor sentiment towards the metal once again after the current panic selling subsides.

Fitch expects copper prices to rebound and increase from spot levels of $5 713/t in the coming months to average closer to or higher than the year-to-date average of $6 005/t in 2020.

For iron-ore, Fitch recently revised upwards its price forecast for 2020 from $80/t to $85/t. This still means a slight consolidation from current spot levels of $80/t, as Fitch anticipates the coronavirus epidemic to further hamper investor sentiment towards iron-ore prices in the coming weeks, bringing down the year-to-date average of $90/t before stabilising in the second half of the year.

For aluminium, Fitch forecasts prices to average $1 850/t in the year, up from spot levels of $1 687/t, as it continues to expect stronger global demand than in 2019.

For nickel, Fitch forecasts prices to average $1 500/t in the year, compared to a year-to-date average of $13 498/t and spot prices of $13 000/t.

For tin, Fitch forecasts prices to average $18 500/t over 2020.

For zinc, Fitch forecasts prices to average $2 450/t in 2020, compared to a year-to-date average of $2 325/t and spot prices of $2 222/t.

For lead, Fitch says it is likely to revise upwards its current price forecast of $1 850/t for 2020 as spot prices hover around $1 843/t and the year-to-date average is at $1 916.