A Real-Time Framework for Forecasting Metal Prices

Andrea Bastianin, Luca Rossini and Lorenzo Tonni

No 386191, FEEM Working Papers from Fondazione Eni Enrico Mattei (FEEM)

Abstract: This paper develops a real-time forecasting framework for monthly real prices of four key industrial metals – aluminum, copper, nickel, and zinc – whose demand is rising due to their widespread use in manufacturing and low-carbon technologies. To replicate the information set available to forecasters in real time, we construct a new dataset combining daily financial variables with first-release macroeconomic indicators and use nowcasting techniques to address publication lags. Within this real-time environment, we evaluate the predictive accuracy of a broad set of univariate, multivariate, and factor-augmented models, comparing their performance with two industry benchmarks: survey expectations and futures-spot spread models. Results show that although short-run metal price movements remain difficult to predict, medium-term horizons display substantial forecastability. Indicators of manufacturing activity tied to primary metals — such as new orders and capacity utilization — significantly improve forecasting accuracy for aluminum and copper, with more moderate gains for zinc and limited improvements for nickel. Futures and survey forecasts generally underperform the real-time econometric models. These findings highlight the value of incorporating timely macroeconomic information into forecasting frameworks for industrial metal markets.

Keywords: Climate Change; Dairy Farming; Demand and Price Analysis; Environmental Economics and Policy (search for similar items in EconPapers)
Pages: 37
Date: 2025-12-18
References: Add references at CitEc
Citations:

Downloads: (external link)
https://ageconsearch.umn.edu/record/386191/files/NDL2025-34.pdf (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:ags:feemwp:386191

DOI: 10.22004/ag.econ.386191

Access Statistics for this paper

More papers in FEEM Working Papers from Fondazione Eni Enrico Mattei (FEEM) Contact information at EDIRC.
Bibliographic data for series maintained by AgEcon Search ().