Traders in the United States are paying significantly higher prices for copper, steel, and aluminium as they rush to secure supplies before President Donald Trump’s planned tariffs take effect. On Sunday, Trump announced that he would impose a 25 percent tariff on all steel and aluminium imports and has hinted at levies on imported copper. This move has caused a sharp rise in US metal prices, which have now reached notable premiums compared to European prices.
The premium for benchmark New York Comex copper futures has surged to more than $800 per tonne over the London price, the largest gap since early 2020. As of Monday, Comex copper was trading at just over $10,000 per tonne, reflecting a market distorted by concerns over the looming tariffs. Analysts suggest that the sharp rise in US premiums is less about demand but more about fears of a potential supply shortage. Tom Price of Panmure Liberum noted that the US is unable to easily switch to alternative sources, and buyers are competing fiercely to secure the metal.
According to Daria Efanova from Sucden Financial, the higher US premiums reflect the market’s expectations that prices will continue to rise due to the tariffs, even before they officially take effect. Trump is expected to provide more details about the tariffs, including possible exemptions, later this week, but many traders are cautious and waiting for clearer policies. This uncertainty has led to a sense of skittishness in the market, with some analysts noting that it has created a hesitation to invest.
Increased prices are not only affecting copper but also other metals like steel, aluminium, and precious metals such as silver and gold, with US traders paying hefty premiums to secure access ahead of the tariffs. The tariffs are particularly concerning for Canadian aluminium smelters, which supply approximately 44 percent of the US’s aluminium needs.
The Financial Times reports that copper stocks in US CME warehouses have seen a notable increase, as companies work to avoid paying the potential tariffs. With US traders scrambling to lock in supplies, the pressure on the market is expected to continue in the coming months as the tariffs near implementation.
