A surprise tariff announcement from Donald Trump sent copper prices skyrocketing—marking the metal’s biggest surge since the 1980s.
Copper prices in the US spiked as high as $5.89 per pound on Tuesday, surging 17% intraday before closing up 13% at $5.68. The rally was triggered by President Trump’s announcement of a 50% tariff on copper imports, a move analysts warn could rattle global supply chains and drive short-term buying frenzies.
What Happened:
- Trump’s Cabinet announcement: Trump confirmed his administration will impose a 50% tariff on copper imports, likely by the end of July or “maybe” August 1, according to Commerce Secretary Howard Lutnick.
- Analyst reaction: Morgan Stanley noted the tariff would push copper prices higher short term, though domestic inventory buildup could later ease pressure.
- Market scramble: Plusmining’s Juan Carlos Guajardo told Bloomberg the sudden tariff news shocked traders expecting a smaller hike—driving “a lot of buying” before the policy takes effect.
- Bernstein forecast: Even before Trump’s announcement, Bernstein analysts expected higher copper prices through year-end as inventories were already shifting into US warehouses.
Why It Matters: The US imports over half of its refined copper—mostly from Chile (38%), Canada (28%), and Mexico (8%). But domestic output fell 3% in 2024, leaving US supply vulnerable. Tariffs will raise costs for manufacturers and buyers in industries ranging from construction to EV batteries.
The Bigger Picture:
This latest tariff push follows Trump’s broader strategy of weaponizing trade policy. In February, the White House claimed foreign copper supply posed a “direct threat” to US national security, citing weak domestic refining capacity. Trump has also hinted at 200% tariffs on pharmaceuticals, fueling concerns of broader trade disruptions.
Global Confusion: Chile’s foreign ministry said it hasn’t received any formal notice of new copper tariffs. Even Codelco’s chairman admitted it’s unclear which copper products will be hit, saying Trump only mentioned “copper in general terms.”
What’s Next: Until clarity emerges, volatility is likely to persist in copper markets. With traders front-loading inventory and uncertainty swirling, analysts expect the current price spike may be just the beginning of a turbulent few months.
Disclosure: This article does not represent investment advice. The content and materials featured on this page are for educational purposes only.
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