Copper prices experienced a significant drop following President Trump’s announcement of a 50 per cent tariff on all semi-finished copper products entering the United States. The market reacted strongly, with prices falling as much as 20 per cent on Wednesday, marking the largest intraday drop since at least 1988. This steep decline reflects a dramatic readjustment of market expectations regarding the scope of Trump’s trade policy on the metal.
The new tariff rates are scheduled to take effect on August 1, according to a White House fact sheet. Many in the US market had anticipated some form of tariff on raw copper, a crucial component for wiring and various products widely used in the homebuilding, construction, and automobile industries. However, the decision to exempt refined copper from the tariffs has provided some relief to these sectors.
The copper levies, enacted under Section 232 of the Trade Expansion Act, will operate independently of existing tariffs on automobile imports implemented earlier this year. According to the White House, if a product is subject to auto tariffs, the import tax on vehicles will take precedence over the copper duty. In a related move, President Trump invoked the Defence Production Act, a law from the Korean War era. This action mandates that 25 per cent of high-quality copper scrap and specific forms of raw copper produced in the US must be sold domestically.
