Summa Silver Corp. (TSXV: SSVR, OTC: SSVRF, FRA: 48X)
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New York copper markets have witnessed a wild week, with Comex copper futures surging by over 5% in a single day during the Asian trading session – marking its largest one-day jump in months. The widening price gap with global benchmark prices in London and Shanghai has raised alarms. The catalyst behind this dramatic move appears to be a signal from U.S. President Trump concerning a potential “25% tariff on copper imports.”
On Tuesday, during a speech in Congress, President Trump hinted at the possibility of imposing a 25% tariff on imported copper, stating that this policy had already begun to take effect. Although the U.S. Department of Commerce had only initiated a national security investigation into copper imports – a decision that may take months – Trump’s aggressive comments caught the market off guard. Traders are now concerned that the eventual tariff may surpass expectations in both severity and speed of implementation.
This is not the first time Trump has stirred up the copper market in a week. At the end of February, he urged the Department of Commerce to investigate copper imports on national security grounds, which caused Comex copper prices to spike and led to an expanding price differential with both the London Metal Exchange (LME) and the Shanghai Futures Exchange. Trump’s recent remarks on Tuesday have only intensified market anxiety, pushing New York copper prices to recent highs.
As of Wednesday, the premium of Comex copper futures over LME copper prices has approached 12%, nearing the historical peak of 13% set the previous month. In absolute terms, while LME copper is trading around $9,500 per ton, New York copper is priced about $1,000 per ton higher. This significant disparity is spurring global traders to rush copper shipments to the U.S. in a bid to lock in profits before the potential imposition of tariffs.
At the same time, declining copper inventories in New York suggest that U.S. manufacturers might also be stockpiling ahead of anticipated price hikes. Increased withdrawal requests from LME warehouses further underscore the urgency in managing supply chains amid global distribution shifts.
The surge in copper prices has set off a chain reaction across other industrial metals. On Wednesday, LME zinc prices climbed 2.5%, aluminum prices rose 1.7%, and industrial metals along with mining stocks in Europe also recorded gains. This upward trend corresponds with developments in German politics: Friedrich Merz, Germany’s prospective prime minister, announced proposals to amend the constitution to exempt defense and security expenditures from fiscal restrictions, sending a strong signal to bolster national defense and industrial sectors.
Additionally, China’s recent commitment to reduce steel production capacity to address oversupply issues has propelled global steel shares to new highs.
Despite the current speculative fervor dominating the markets, analysts warn that imposing exorbitant tariffs on copper could significantly disrupt global supply chains. As a key industrial metal used extensively in construction, power, and renewable energy sectors, volatile copper prices would directly escalate manufacturing costs. The steel and aluminum tariffs signed by Trump (which went into effect on March 12) have already sparked international protests; a similar move on copper could further intensify trade tensions.
Market participants are now closely monitoring two key variables: the final outcome of the U.S. Department of Commerce’s investigation and whether Trump’s “verbal threat” will materialize into an official policy. Regardless of the outcome, it appears that the “Trump volatility” in the metals market has only just begun.
