Copper squeeze unravels with window closing to beat Trump tariff
An acute copper supply squeeze is coming to an abrupt end as President Donald Trump’s plan to soon slap a 50% tariff on the metal narrows the window to profit from surging US prices.
Key spreads on the London Metal Exchange — which had soared in late June as a rush to ship the metal to the US drained stockpiles — have now collapsed.
The latest indication from the White House that a levy is imminent means time is running out to seek to front-run the policy and profit from arbitrage. Shipments from European and Asian sheds take weeks to reach American shores, and cargoes will soon risk arriving after tariffs are in place.
Spot copper on the LME traded lower than three-month futures for the first time in more than a month, a sign demand for metal in the exchange’s warehousing network is fizzling rapidly. A key one-day spread has also plunged.
Commerce Secretary Howard Lutnick, speaking to CNBC shortly after a Cabinet meeting, said his department’s investigation into copper had concluded and he expected the levy “likely to be put in place end of July — maybe Aug. 1.”
“Copper is finished. We’re done with our study,” Lutnick said. “We’ve handed the study over to the president. The president knows that he has the ability, since we’ve studied the market for copper, to set the market tariff for copper.”
For months, copper has poured into the US as traders raced to buy up the metal elsewhere and sell it at higher prices in New York. Once those tariffs are in place, that arbitrage opportunity disappears, easing demand for spot copper in Europe and Asia.
New York futures posted a record jump to an all-time high on Tuesday after Trump’s off-the-cuff announcement of the 50% duty.
Comments
Projects
Latest Multimedia
Latest News
Showroom
ESAB South Arica, the leading supplier of high-end welding and cutting products to the Southern African industrial market is based in...
VISIT SHOWROOM
Rooted in the hearts of South Africans, combining technology and a quest for perfection to bring you a battery of peerless standing. Willard...
VISIT SHOWROOM
Press Office
Announcements
What's On
Subscribe to improve your user experience...
Option 1 (equivalent of R125 a month):
Receive a weekly copy of Creamer Media's Engineering News & Mining Weekly magazine
(print copy for those in South Africa and e-magazine for those outside of South Africa)
Receive daily email newsletters
Access to full search results
Access archive of magazine back copies
Access to Projects in Progress
Access to ONE Research Report of your choice in PDF format
Option 2 (equivalent of R375 a month):
All benefits from Option 1
PLUS
Access to Creamer Media's Research Channel Africa for ALL Research Reports, in PDF format, on various industrial and mining sectors
including Electricity; Water; Energy Transition; Hydrogen; Roads, Rail and Ports; Coal; Gold; Platinum; Battery Metals; etc.
Already a subscriber?
Forgotten your password?
Receive weekly copy of Creamer Media's Engineering News & Mining Weekly magazine (print copy for those in South Africa and e-magazine for those outside of South Africa)
➕
Recieve daily email newsletters
➕
Access to full search results
➕
Access archive of magazine back copies
➕
Access to Projects in Progress
➕
Access to ONE Research Report of your choice in PDF format
RESEARCH CHANNEL AFRICA
R4500 (equivalent of R375 a month)
SUBSCRIBEAll benefits from Option 1
➕
Access to Creamer Media's Research Channel Africa for ALL Research Reports on various industrial and mining sectors, in PDF format, including on:
Electricity
➕
Water
➕
Energy Transition
➕
Hydrogen
➕
Roads, Rail and Ports
➕
Coal
➕
Gold
➕
Platinum
➕
Battery Metals
➕
etc.
Receive all benefits from Option 1 or Option 2 delivered to numerous people at your company
➕
Multiple User names and Passwords for simultaneous log-ins
➕
Intranet integration access to all in your organisation
