Copper Holds Decline as Tariff Fears Ease

Copper futures traded around $6.45 per pound on Friday after plunging nearly 5% in the previous session, pressured by reports that the US is reconsidering plans to impose import tariffs on refined metals. US officials were reportedly concerned that the proposed levies could push domestic copper prices even higher and increase manufacturing costs. The metal surged to record highs earlier this week as traders redirected shipments to US warehouses to capitalize on tariff-driven gains in local prices, tightening global supplies. This came amid ongoing shortages of sulfuric acid for major copper refiners worldwide, as supply pressures from GCC countries prompted China to suspend exports. Mined supply has also weakened, with Codelco and Freeport-McMoRan reportedly posting double-digit production declines, shortly after the International Copper Study Group pointed to a 1.1% drop in global output during the first half of the year.

Copper futures in the US plummeted to $6.45 on Thursday from the record high of $6.5 earlier in the session on reports that the US will backtrack on copper tariffs. The White House is reconsidering its earlier signal to place levies on refined copper products due to high inflation for manufacturers ahead of the midterms. Expectations that the US would add refined copper to tariffs on semi-finished products triggered a surge in global prices and large inflows of metal into North America. This coincided with the ongoing shortages of sulfuric acid for major copper refiners worldwide as supply pressures from GCC countries drove China to halt their exports. Consequently, backwardation curves steepened both in major Western copper exchanges. Mined supply has also faltered with reports from Codelco and Freeport-McMoRan posting double digit declines in production, shortly after the International Copper Study Group pointed to a 1.1% decline in global production in the first half of the year.

Copper decreased 5% to 6.4636 USD/Lbs