Copper prices remain volatile as traders and analysts grapple with uncertainty over the timing and impact of impending U.S. tariffs, sparking a race to move metal into the country before duties take effect. The market, which saw CME spot prices hit a record $5.277/lb in March, faces a precarious divide: bullish banks like Goldman Sachs predict sustained highs, while bears warn of a crash once tariffs disrupt the current arbitrage rush.
Key Developments:
Tariff Timeline Confusion: President Trump’s “Liberation Day” tariff announcement on April 3 has fueled speculation that copper levies (likely 25%) could arrive sooner than the expected 270-day Section 232 review period, tightening the window for importers.
Arbitrage Rush: Up to 500,000 tons of copper may be en route to U.S. ports to exploit the $1,600/ton premium for customs-cleared metal. However, logistical hurdles—like CME’s restrictive “good delivery” brands and LME stock shortages (down 59% since February)—complicate the scramble.
Analyst Divide: Goldman Sachs holds a bullish outlook (
10,700/ton by 2026),while Citicuts near−term forecasts to 9,500/ton, and BNP Paribas warns of a plunge to $8,500/ton post-tariff implementation.
Market Risks:
Supply Chain Bottlenecks: LME stocks, dominated by Chinese and Russian brands, are ill-suited for U.S. buyers needing South American copper, forcing costly brand swaps and location shifts.
Global Ripple Effects: A shorter tariff window could soften supply squeezes outside the U.S., dampening bullish price drivers.