Cailian Press, July 31st (Editor: Huang Junzhi)
According to reports, the White House in the United States announced on Wednesday (30th), local time, that President Trump has signed an order declaring a tariff on several categories of imported copper products, effective from August 1st (Friday). This marks the latest metal targeted by Trump following steel and aluminum.
Specifically, according to the announcement released by the White House,
The United States will impose a 50% tariff on imported semi-finished copper products (such as copper tubes, wires, rods, plates, and pipes) and copper-intensive derivative products (such as pipe fittings, cables, connectors, and electrical components) starting from August 1st.
Copper input materials (such as copper ore, concentrate, galvanized copper, cathodic copper, and anodic copper) and scrap copper are not subject to the “232 clause” or equivalent tariff restrictions.
Under the U.S. Trade Expansion Act of 1962, Section 232, the President of the United States has the authority to impose tariffs or set quotas on imported products for “national security” considerations.
The tariff on Copper 232 does not overlap with the Automobile 232 tariff.
The announcement stated, “If a product is subject to the Automobile 232 tariff, then the Automobile 232 tariff shall be imposed, not the Copper 232 tariff.”
On the same day, after the White House announced this tariff, New York copper prices plummeted by more than 18%, reaching $4.60 per pound. The largest copper producer in North America, Freeport-McMoRan, and Southern Copper, respectively, fell by about 10% and over 6%.
On the 9th of this month, Trump had announced that he would impose a 50% tariff on all imported copper into the United States starting from August 1st. At that time, New York copper futures soared to nearly a historical high of nearly $6 per pound.
StoneX Financial’s Senior Metals Analyst, Natalie Scott-Gray, commented that the new regulations and their focus on semi-finished products have constituted a “huge market surprise.”
The Trump administration emphasized that following the United States’ 50% tariffs on steel and aluminum, the new tariffs aim to promote domestic industries and address the “trade imbalance” issue. About half of the refined copper in the United States relies on imports, with domestic copper refining capacity not sufficient to meet its own needs. The United States has only two copper smelting plants, owned by Freeport McMoran and Rio Tinto Group respectively.
On the other hand, the United States has historically been an exporter of copper scrap and concentrate due to its lack of refining capabilities, with most of these materials being transported to other countries for processing.
As an important supplement to the Wednesday executive order, Trump stated that he would require 25% of the high-quality waste copper produced in the United States to be sold domestically.
Analysts also highlighted the importance of the scrap copper market this year and the potential impact of banning exports on the growth of the domestic copper processing industry. Alastair Munro, a basic metals strategyist at Marex, had previously mentioned, “The United States has a large copper production, but the bottleneck mainly lies in the processing stage.”
According to the above orders, starting from 2027, 25% of the copper input materials (such as copper ore, concentrate, galvanized copper, cathodic copper, and anode copper) will also need to be sold in the United States. By 2028, this proportion will increase to 30%, and by 2029, it will reach 40%.
The order authorizes the use of the Defense Production Act to promote the manufacturing and supply of copper in the United States and mandates the Department of Commerce to issue export permits for high-quality scrap copper.
Experts warned that “copper tariffs” could raise the prices of various products, from building materials to electronics, as these products all use this versatile metal.
According to the Tax Foundation, Trump’s tariffs on other industries and ongoing trade investigations into imported cars, timber, and medicine could suppress overall U.S. growth.