(Bloomberg) -- Chile, the biggest copper-producing country, trimmed its annual price forecast for the metal on slowing Chinese demand and prospects of an easing in U.S. stimulus.

The Chilean government’s copper commission, Cochilco, expects prices to average $4.20 a pound this year, according to a presentation Tuesday, down from a $4.30 call made three months ago. Prices are expected to average $3.95 next year as the market swings into surplus, Cochilco said.

Since surging to record levels in May as producers struggled to meet demand in a global recovery, copper prices have retreated and then bounced around in a fairly tight range. Copper futures traded at around $4.32 Tuesday in New York on the Comex, and have averaged at $4.19 this year.

Chinese demand has slowed for the industrial metal that’s seen as an economic bellwether and traders are expecting the Federal Reserve to start withdrawing stimulus. At the same time, the supply side has largely recovered from the pandemic shock.

Cochilco sees global copper demand increasing 2.4% this year and 3% next year, while supply is seen expanding 1.2% and 4.5%, respectively. That will see the market swing from deficit this year to surplus in 2022, the agency said.

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