U.S. President Donald Trump announced on Tuesday that he would impose a 50% tariff on copper imports, triggering a surge of over 12% in U.S. Comex copper futures, which climbed to an all-time high.
In contrast, copper prices on the Shanghai Futures Exchange (SHFE) and the London Metal Exchange (LME) dropped, as the move signaled the likely end of a long-standing arbitrage trade that had been funneling copper out of global markets toward the U.S.
Reactions from Analysts and Industry Sources Across Asia:
Goldman Sachs Analysts:
- They believe the 50% tariff could serve as an initial negotiating tool, potentially leading to rollbacks or exemptions later.
- Due to the tariff threat, they anticipate a short-term rush in shipments to the U.S. as sellers try to beat the implementation deadline.
- Their year-end 2025 forecast for LME copper remains at $9,700 per ton, but they now see a reduced likelihood of prices exceeding $10,000 in Q3.
Citi Analysts:
- Citi now assumes a 50% copper import duty under Section 232 as its base case.
- The expected arbitrage between COMEX and LME has widened, with prices now forecasted to reflect 25–35% of LME levels (around $2,300–$3,300/ton), up from the previous 15–20%.
- Excess U.S. copper stocks could potentially eliminate the need for refined copper imports through the rest of 2025.
Zhao Yongcheng, Benchmark Mineral Intelligence:
- SHFE copper prices are currently facing pressure but are expected to rebound once the U.S. tariff becomes official, given tight short-term fundamentals.
- The growing price gap between COMEX and LME is likely to encourage continued arbitrage activity, limiting further price declines, though short-term downside risks remain.
Matt Huang, Bands Financial:
- In the near term, spot copper demand—particularly from South America—will push premiums higher.
- Chinese exporters may still rush shipments before the tariff deadline, but subsequent arrivals are expected to ease, leading to weaker premiums.
- Longer term, once the tariffs are in place, U.S. demand may decline, softening prospects for LME and SHFE copper.
Marcus Garvey, Macquarie:
- With the CME-LME price arbitrage opportunity closed, U.S. copper imports could plunge from around 200,000 tons per month to roughly 30,000 tons monthly, staying subdued while domestic inventories are drawn down.
- He believes the market may not fully price in the tariff, as existing U.S. stockpiles reduce the need for new spot imports.
Michael Wu, Shanghai Metals Market:
- Few in Asia are currently purchasing copper for U.S. delivery due to the short lead time before the tariff takes effect.
- Only shipments from Latin America may still meet the deadline.
Manager at a Chinese Smelter:
- Once the U.S. tariffs are enforced, copper flows are expected to shift toward China and other markets, with prices reverting to levels more in line with actual supply and demand dynamics.
