Copper traders are growing increasingly cautious about the metal’s bull market as President Donald Trump approaches the halfway mark of his second term with no tariffs on refined copper in place, Bloomberg reported on Sunday. The market has surged since Trump’s re-election on concern that he may impose tariffs on the metal, and traders are now weighing how much of the price survives if the levy never arrives. Copper closed Friday at 6.60 dollars a pound, up 1.06 percent on the day in the market tables, after a record run earlier in the autumn.
The physical build behind the trade is large. Reuters reported last week that the tariff threat has left Comex approved warehouses in the United States holding roughly 70 percent of the world’s visible copper stocks, creating shortages elsewhere and fuelling a price surge despite a global surplus. Comex prices reached a record 6.83 dollars a pound, or 15,057 dollars a ton, on September 22. Since the end of February last year, Comex copper stocks have climbed nearly 750 percent to more than 714,000 tons, copper stored in LME warehouses in New Orleans and Baltimore has jumped 44 percent since mid August to nearly 130,000 tons, and Macquarie estimates total US stocks on and off exchange at about 1.6 million tons.
The incentive to keep shipping metal is fading with the spread. The Comex premium over the London Metal Exchange, after freight and insurance, hit a record above 3,000 dollars a ton in July last year and is now about 310 dollars a ton, high enough at times to make shipping profitable but no longer consistently so, Reuters reported. Wood Mackenzie analyst Charles Cooper said the United States built a copper stockpile without spending taxpayer money, but that the collapsed arbitrage makes the incentive to keep moving metal much weaker.
The decision calendar is now the trade. The Commerce Department was due to report on the domestic copper market by June 30 so the president could decide whether to impose a 15 percent tariff on refined copper imports from January 1, 2027, rising to 30 percent in 2028, and no decision has been announced. Macquarie analyst Alice Fox regards a January deadline that passes without a decision as the most likely scenario, leaving the question unresolved. Panmure Liberum expects the US surplus to amount to 1.6 million tons this year, after imports of more than 1.62 million tons last year, up 80 percent from 2024 on Trade Data Monitor figures, against US production of 1 million tons on US Geological Survey figures. Whether tariffs are imposed, and whether the possibility alone keeps attracting copper, was set to be a key talking point at LME Week in London, which started on October 18.