The price of copper in the U.S. rose to a new all-time high Tuesday, an increase featuring intraday spikes not seen in nearly four decades after President Donald Trump signalled he’d enact tariffs on the metal, which some analysts said could briefly disrupt the global market.
Trump ordered an earlier investigation into possible tariffs on copper imports, arguing global competitors could pose a threat to national security and economic stability.
Key Takeaways
- Trump said during a Cabinet meeting Tuesday he would impose a 50% tariff on copper imports, which Commerce Secretary Howard Lutnick reportedly said would likely be implemented by the end of the month, or “maybe” Aug. 1.
- Copper futures briefly rose 17% to a record $5.89 per pound, the largest intraday increase for the commodity since 1989, before concluding Tuesday up 13% at $5.68.
- Morgan Stanley analysts said in a note Tuesday the proposed tariffs would support higher copper prices in the U.S. as the cost of bringing the metal into the country increases, but they noted this would likely be a short-term rise as the domestic inventory grows.
- Juan Carlos Guajardo, founder of the mining and metals market consultancy firm Plusmining, told Bloomberg the price of copper will rise “significantly” because the market anticipated a lower tariff rate and there will be “a lot of buying” before the levies go into effect.
- Analysts from Bernstein, in a note hours before Trump’s announcement, forecast rising copper prices through the end of the year, citing an “expectation” among copper traders that Trump would introduce tariffs on the metal as “inventories are shifting to U.S. warehouses.”
Where Does The U.s. Import Copper From?
Just over 50% of the total refined copper consumed in the U.S. is imported, according to the U.S. Geological Survey. Of the copper imported, about 38% comes from Chile, according to USGS, followed by Canada (28%) and Mexico (8%). Copper production declined at a majority of copper mines in the U.S. in 2024, as domestic copper output declined by about 3% over the previous year.
Surprising Fact
Chile’s foreign ministry reportedly said the country has yet to receive communication about the U.S. implementing tariffs on copper. Maximo Pacheco, chairman of the Chilean state-run miner Codelco, told Reuters it’s unclear what copper products would be affected by Trump’s tariffs because Trump “referred to copper in general terms.”
Key Background
Trump’s proposed tariffs follow his ordered probe on possible copper levies. The White House said in February that global copper competitors could pose a “direct threat to [U.S.] national security and economic stability,” noting while the U.S. has “ample” reserves, smelting and refining capacity “lags significantly.”
Lutnick, who provided no specifics about findings from the probe, said the Trump administration’s investigation was “finished.” In his announcement for copper tariffs, Trump suggested he would also impose pharmaceutical tariffs of about 200%. Pharmaceuticals are exempt from Trump’s wide-reaching tariffs announced on U.S. trade partners earlier this year, though he has threatened to impose new tariffs on the sector.
