Copper Prices Surge as US-China Trade Tensions Tighten Market

Global copper prices have surged past $14,000 a ton on the London Metal Exchange, threatening new all-time highs as the market tightens. This volatility stems from simultaneous supply disruptions in China and trade uncertainty in the United States.

In the U.S., Donald Trump is considering whether to extend duties on semi-finished copper products to include raw metal. This potential tariff decision has prompted traders to hoard copper, contributing to a significant drawdown of stockpiles. Since May, London Metal Exchange warehouses have seen their inventories shrink by more than 40% due to heavy withdrawals by firms including Mercuria, Trafigura, Vitol Group, and Hartree Partners, LP.

China is concurrently experiencing supply shortages. Reduced smelter production, caused by tight feedstock and disruptions within the domestic copper scrap recycling industry, has further constrained availability. Market analysts indicate that while continued uncertainty may sustain the current squeeze, the formal imposition of new U.S. tariffs is likely to trigger a sharp price surge.