LONDON, Oct. 20 -- Copper and aluminum prices will likely drop through next year because supply will outpace demand, researcher Brook Hunt & Associates Ltd. said.

    Copper for immediate delivery will average $5,300 a metric ton next year, 15 percent below the Oct. 16 closing price on the London Metal Exchange, Julian Kettle, a Brook Hunt analyst, said in an interview in London. Aluminum will average $1,700 next year, or 9 percent less than the Oct. 16 closing price, he said.

    Benchmark copper prices on the LME more than doubled this year as China imported record amounts of metal in the first half. Copper supply will outpace demand by 600,000 metric tons this year and 500,000 tons next year, Brook Hunt estimates.

    "It is beyond that that we see there is a potential for copper prices to rise higher because of a shortage of projects," Kettle said Oct. 16.

    Aluminum supply may outpace demand by 1.7 million tons this year, rising to 2.5 million tons next year, he said. Lead, zinc and nickel are also expected to decline from the most recent price through 2010, Kettle said.

    "There is a structural overcapacity in all the metals, except for copper," he said.

    (Source: Bloomberg)