The “Battle of Copper” of the US unleasies a historical collapse in the markets

Julio was a month of vertigo in metal markets. The only threat of a 50% tariff to copper imports in the United States announced at the beginning of the month by Donald Trump, fired prices in New York and unleashed a counterreloj race of traders that filled ports and copper stores before the deadline of August 1.

An unexpected turn. Hours before the term, the White House decided that the tax would not cover all copper, but only to pipes, cables and electrical components. As Financial Times has detailedkey products such as minerals, concentrated, cathodes and scrap metal were excluded. Besides, According to Reutersthe encumbrances would not accumulate with those already in force on cars. The result was immediate: a collapse of between 17% and 22% in copper futures in the Comex bag, As the Wall Street Journal has reported. It was the greatest daily fall since 1987.

The blow is significant. As Financial Times explainedThe United States depends on imports for about half of its refined copper consumption and only has two foundations: Freeport-Mcmarran and Rio Tinto. Therefore, the measure protects manufacturers who use copper (electronics, plumbing, wiring), but does not stimulate the mining industry or domestic refining, historically limited. Besides, From Wall Street Journal They recalled that building new foundations costs more than 5,000 million dollars and has been in the current presidency for more than 5,000 million, which remains incentive to local investment.

“A national security problem.” Thus I justify Donald Trump the measure. According to Reuters, The decision is framed in a wave of simultaneous tariff ads against India, Brazil and South Korea, as well as in the end of the exemption known as minimis for low value packages. According to analysts cited by The Guardianthe shock in the tariff policy of copper suggests that someone in the presidential environment convinced Trump that the US economy could not bear such a wide tariff. The market interpreted it as an “Epic Backflip”, that is, a political gesture that sought to show commercial firmness, without hitting American manufacturing.

At the global level? In the short term, the most visible result will be an inventory overload in the US. Since Trump announced the possible tariff in July, the country received more than 550,000 tons of copper, According to Kpler firm data cited by Reuters. Only a fraction of these shipments managed to reach American soil before August 1.

This opens the possibility that part of that copper is re -exported, although analysts such as Macquarie calculate that the market would need at least nine months of internal consumption to absorb it. For Goldman Sachs, the scenario of a possible refined copper rate in 2027 will avoid extreme differences between US prices and international.

In parallel, Bloomberg He has highlighted that attempts to obtain exemptions from strategic partners such as the European Union, Chile or South Korea failed to stop the measure, which raises commercial tensions in the metal sector.

The forecasts are not reassuring. The current tension is inserted in a much more complex background trend. According to the latest report by the International Energy Agencycopper could face a 30% supply deficit by 2035, due to the fall in the mineral law, the shortage of new deposits and long development terms (17 years on average for a new mine). The demand, on the other hand, continues to grow: 3% in 2024, driven by electrical networks, electric vehicles and data centers. IEA has pointed out that solutions go through accelerating permits, fostering recycling and exploring partial substitutes such as aluminum in non -critical applications.

The immediate future of copper. As Tom Price, Analyst of Panmure Liberum, has sentenced, To The Guardian: “The markets are now resetting the price of refined copper after the epic Trump posture change.” The episode leaves a warning: copper, key mineral for energy and digital transition, has become a raw material as political as strategic. With an upward demand and an increasingly compromised supply, the decisions that today affect its trade will mark, to a large extent, the energy future of the planet.

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