Aluminium and copper are expected to stride higher, but nickel, which surged earlier this year, is now past its prime, according to a Reuters poll of up to 28 analysts globally.

More robust European and Japanese growth, good Chinese demand and a still expanding US, albeit at a slower pace, means "metal consumption is seen exceeding supply in most metals well into 2001," said Martin Squires of Carr Futures.

But price rises will be muted by the approach of a peak in industrial output of the biggest nations, which typically precedes a slowdown in metals demand and prices, coupled with a debate on the likelihood of a gradual or sharp US slowdown.

"The nervousness about the economic future of the global economy is also to an extent reflected in current prices," said Lawrence Eagles of GNI."While stock trends suggest supply deficits in virtually allmetals, prices have failed to rally by normal amounts at this stage in the economic cycle because of a general reluctance by consumers to raise stock levels in line with order books."

The global economy is expected to grow at a rate of 4.3percent in 2000 and 3.8 per cent in 2001 as US growth slows, according to Standard Bank's Robin Bhar. Demand growth should slow after a robust two years."For most metals, 2001 may prove to be a cyclical peak.Certainly most annual averages will exceed this year's forecast. Overall our outlook for 2001 reinforces our positive stance on the base metals complex," Bhar said.

Aluminium, copper set to reap the greatest benefits Top traded aluminium and copper are expected to enjoy thelargest price rises on the back of the solid fundamentals.

The London Metal Exchange aluminium cash price, whichaveraged 70.8 cts per pound in the first half of the year, is seen climbing to trade at an average 72.6 cents a pound for the whole of 2000, compared with a 1999 average of 77.7 cents.

Copper, which traded at an average 80.2 cents a pound in thefirst half, is seen rising to 83.1 cents, against 84.3 cents last year.In 2001, analysts see aluminium averaging 76 cents a poundand copper 89.7 cents.''

"The aluminium market still looks to be the metal with thebest prospects in the sector. ``The market balance is expected to sustain a deficit in both 2000 and 2001 and with inventories aaready comparatively low there is scope for further gains," said Rhona O'Connell of Canaccord Capital Corp.

Julien Garran of ABN AMRO said power price surges that haveforced production shutdowns and curbs in the U.S. Northwest may last longer than expected, or even be permanent, giving prices an extra boost.Forward power prices there will fall to $40/$45/MWh byDecember, still double the old contract prices, and will then rise again ahead of the summer of 2001.

"We have identified 160,000 tonnes per year of smeltercapacity that is vulnerable to closure in the coming weeks and a further 300-350,000 tonnes per year that may be at risk once current contracts expire on October 1, 2001," Garran said.The potential for problems might also discourage Alcoa Incfrom restarting idled capacity at its Wanatchee and Troutdale smelters, which might have kept a cap on prices.

Copper is also seen outpacing many of the other metals.Standard's Bhar said copper is forecast for a larger deficitof around 150,000 tonnes in 2001, which will cause a further drawdown in inventories, supporting higher prices."Copper has inadequate production coming on for the next fewyears," said Ted Arnold of Prudential Bache International."Providing consumption growth continues to be around fourpercent metal supply will continue to tighten, particularly if China goes on importing 400,000 to 500,000 tonnes a year of copper units..."Copper demand is later-cycle than demand for other metals,given its exposure to the construction markets in all regions, which should ensure healthy demand this year, said Garran.

Nickel's run draws to close Nickel prices are expected to come off on increased Western Australian production, said George Grohmann, a base metals and steel analys t with South Africa's Rice Rinaldi Turner.Nickel mines in Western Australia are seen increasing outputas they overcome problems with their new production process.

Funds, in anticipation of this increased production, areselling metal, which is holding the price where it is because on stock levels in should be higher, he said.Tin is expected to be relatively steady this year, with theChinese supplying any big demand surgest the West may have, while zinc's rise is seen capped by potential Chinese exports. Lead may stay under pressure as stocks stay high on another year of surplus.

"Zinc we see as modestly higher in 2001 on the back ofmerchant activity more than anything else.''`` If the price goes too high, too quick, then watch out for thousands and thousands of tonnes come cascading in from China as extra supply for the West," Arnold said.