Chile, Canada, Peru Resist Trump’s Copper Tariff Probe, Warn of China Windfall

Key Developments:

• 🌎 Joint Pushback: Chile, Canada, and Peru—supplying 94% of U.S. refined copper imports—formally opposed Trump’s Section 232 national security probe into potential tariffs.
• 📜 Their Argument:
  • Copper imports strengthen U.S. supply chains and pose no security threat.
  • Tariffs would disrupt defense industries (copper is critical for weapons, electronics).
  • China could benefit if tariffs divert Latin American copper to its market.
• ⏳ Timeline: The Commerce Department has until November 2024 to conclude its review.

Why It Matters:

1. Trade War Escalation:
   • Trump’s probe mirrors 2018 steel/aluminum tariffs, which triggered global retaliation.
   • Chile (70% of U.S. copper imports), Canada (17%), and Peru (7%) all have free trade deals with the U.S.
2. China’s Shadow:
   • Beijing consumes 50% of global copper—Chile’s top buyer. Tariffs could push more supply there.
   • Freeport-McMoRan (major U.S. miner) warns tariffs may hurt global growth, raise costs.
3. Industry Split:
   • U.S. miners (like Freeport) could gain from tariffs but fear long-term demand destruction.
   • Downstream manufacturers (construction, EVs) warn of price spikes and shortages.

What’s Next?

• Commerce Dept. Decision: Likely by November, but political pressure may sway outcomes.
• Retaliation Risk: If tariffs hit, Canada/Chile/Peru could challenge them at WTO or impose counter-tariffs.
• China’s Move: May secure more Latin American copper if U.S. taxes imports.