Copper Prices Surge as Trump Considers Fast-Tracking Tariffs

Copper prices soared to a new record on Wednesday, with futures on the Comex exchange surpassing $5.35 per pound. The spike follows reports that President Donald Trump could impose tariffs on copper imports within weeks, far sooner than anticipated.

The widening price gap between US and London markets suggests a rush to ship copper to the US ahead of the possible tariffs. Traders are moving quickly to avoid the additional costs, further fueling the price surge.

“We’re optimistic on copper,” said Fernando Valle, energy analyst at Hedgeye Risk Management. “Like we saw with steel, tariffs can drive prices higher, and we expect a similar pattern here.”

Tariffs Sooner Than Expected

In February, the White House initiated a review of US reliance on copper imports. Industry analysts saw this as a step toward new tariffs. While Wall Street initially anticipated the duties to arrive between September and November, Bloomberg now reports the administration could implement them as soon as May.

“If tariffs are announced next month, we’re likely to see copper shipments surge before the new rules take effect,” Goldman Sachs analyst Eoin Dinsmore said in a note to clients. Copper prices have already jumped nearly 30% since the beginning of the year, reflecting the growing uncertainty.

Global Demand Fuels the Rally

The tariffs are not the only reason for copper’s rapid rise. China’s efforts to stimulate its economy and increased defense spending in Europe are also driving demand. Copper is a key component in everything from construction and transportation to power grids and military equipment.

“China remains the largest buyer of copper, and its infrastructure projects are a major factor behind the price surge,” Valle said. “We’re also seeing strong demand from Europe, especially with countries ramping up defense production.”

Tech companies are another major force. The growth of artificial intelligence and data centers has pushed copper demand even higher, as large-scale infrastructure projects require massive amounts of the metal.

Concerns Over a Trade War

Despite the current optimism, some market analysts warn of risks ahead. A trade war could dampen global economic growth, reducing demand for copper. Heightened uncertainty could also lead to market volatility.

“If trade tensions escalate, it could weigh on the broader economy and reduce copper consumption,” said Nikos Tzabouras, a market analyst at Tradu.com. “Add to that the growing fears of a US recession, and we could see downward pressure on prices.”

Traders and investors are keeping a close watch on the White House's next steps. With uncertainty lingering, copper prices are likely to remain volatile in the near term.

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