Macquarie Bank Ltd., Australia's largest securities firm, raised its price forecasts for copper, nickel and zinc this year and cut estimates for aluminium, lead and alumina.

Copper for immediate delivery on the London Metal Exchange will average $2,959 a pound, or $6 523 a ton, this year, London-based Macquarie analysts led by Jim Lennon and Adam Rowley said in an e-mailed report today. That's 17% higher than the bank's previous forecast.

"Demand growth is near a peak and will slow in 2007," the analysts said in the report. Prices will lower next year and in 2008 as production climbs in response to record prices, prompting investment funds to sell metals, Macquarie said.

Copper production will lag behind demand by 46 000 tons in 2006, less than last year's shortfall of 200, 00 tons, Lennon said today by phone. The market will shift to an oversupply of 53 000 tons in 2007, he added. Copper for three-month delivery on the LME averaged $6 126 this year and rose to a record $8 800 on May 11.

Nickel for immediate delivery will average $8,452 a pound, or $18 633 a ton, which is 15% higher than Macquarie's previous forecast. Prices for nickel, which is used in stainless steel, averaged $17 963 this year.

Demand for nickel will exceed production by 34 000 tons this year, Lennon and Rowley said. Nickel for delivery in three months has jumped 96% this year and touched $26 650 a ton today, the highest since at least 1987. That's the biggest gain among LME-traded metals.

Macquarie raised its zinc estimate by 8% to $2 930 a ton. The metal, used to galvanize steel, has averaged $2 796 a ton so far this year.

Aluminium will average $2 579 a ton this year, 2,5% below the company's previous forecast. The metal has averaged $2 535 so far this year.

Alumina, the raw material used in aluminium production, is forecast to average $509,60 a ton, 12% lower than the previous estimate. China's production is growing faster than expected, Macquarie said.

The estimate for lead was cut 11 percent to $1 063 a ton as rapid growth in Chinese production led to a surplus. The contract has averaged $1 159 so far this year.