Copper prices fell sharply on Thursday (April 3), with the May delivery copper futures on the COMEX dropping to $4.839 per pound ($10,645 per ton), down 10% from the record high set last week. On the London Metal Exchange (LME), copper prices also declined by 2% to $9,510.5 per ton, while aluminum prices hit their lowest level in nearly seven months.
Investors are increasingly concerned that the newly imposed U.S. tariffs by President Donald Trump could severely impact demand for industrial commodities. Although metals were largely excluded from these sweeping trade restrictions, markets remain worried that the broader economic effects of Trump’s policies could slow global growth and curb consumption. Adding to the uncertainty, China has vowed countermeasures, while Japan has urged the Trump administration for exemptions.
The copper price slump immediately affected major copper producers, with most companies experiencing significant stock declines:
– Teck (TSE: TECK.B) saw the steepest drop, plunging as much as 8.2%.
– Freeport-McMoRan (NYSE: FCX) tumbled 7.9%.
– Glencore (LON: GLEN) and Anglo American (LON: AAL) fell 6.1% and 6.3%, respectively.
– Global mining giants BHP (NYSE: BHP) and Rio Tinto (NYSE: RIO) also dropped 1.9% and 1.2%.
Analysts noted, “Industrial metals are facing short-term pressure as investors flock to safe-haven assets and sell off riskier holdings.”
Market analysts warn that copper prices may remain under pressure as investors digest the full impact of the new tariffs. A Citigroup team led by analyst Max Layton predicts that copper prices could fall further to $8,500 per ton in the second quarter.
Trading firm Mercuria pointed out that up to 500,000 tons of spot copper could be diverted to the U.S. market to take advantage of current arbitrage opportunities.
