Potential copper tariff hike is causing global metal movement and oversupply in US

Copper tariffs announced by President Trump have triggered a massive surge in US imports of the metal, overwhelming the American market and straining global supplies. Following the announcement of the duties in February, traders began rushing copper into the US, hoping to capitalize on potential price gains. This influx has collapsed the price differential between US (CME) and international (LME) copper contracts, Reuters reports.

As the agency notes, the copper market is awaiting the implementation of a 25% US tariff, though its timing remains uncertain. The premium for copper in America over the LME has fallen sharply, from nearly $1,600 per ton just weeks ago to $600 per ton. This decline is driven by strong supply in the United States and a simultaneous decrease in global inventories.

According to Reuters, US imports of refined copper have risen to 40,000 tons per week. Consequently, stockpiles on the CME have increased to an eight-year high. Meanwhile, volumes on the LME have fallen to a one-year low.