The price of copper in the United States surged dramatically on Monday after President Donald Trump advanced plans to impose tariffs on industrial metals, including copper. The premium for U.S. Comex copper futures over those traded on the London Metal Exchange (LME) skyrocketed to a record $920 per metric ton, up from $558 just days prior.
Key Highlights:
Tariff Impact:
Trump is expected to announce new 25% tariffs on all steel and aluminum imports, adding to existing metal duties and escalating his trade policy overhaul.
Last week, Trump hinted at potential tariffs on copper, although specific details were not provided.
Market Reaction:
The premium for Comex copper over LME prices has historically ranged from $250 to $500 since Trump took office, reflecting market speculation regarding tariff impacts.
On Monday, the premium surged as traders reacted to the latest news, indicating a significant price arbitrage. According to Benchmark Minerals Intelligence, the market was pricing in the equivalent of a 10.5% tariff on copper.
Historical Context:
The previous peak for the copper premium occurred in late May 2024, reaching $655 per ton when Comex copper hit an all-time high of $5.1985 per pound due to a short squeeze, forcing traders to buy back short positions at a loss.