Interesting to note the sharp drop in copper prices once the US announced the new worldwide tariff regime. For copper futures, this was the largest one-day percentage drop on record in about 40 years.

The drop could be an overreaction to the tariff news, according to Jeffrey deGraaf, head of Renaissance Macro Research. Copper prices are oversold and buyers are everywhere in evidence. There are expectations that prices will recover (somewhat) from these levels.

The US relies on imports for nearly half its annual copper consumption, used extensively in making electric vehicles, clean energy as well as defence and security applications. These are seen by Donald Trump’s administration as crucual to the revitalisation of the US economy, which explains why tariffs on copper were not as aggressive as previously believed.

As critical minerals analyst Ashley Zumwalt-Forbes notes, the 50% US copper tariff affects products like rods, plates, sheets, strips, and foil. These are downstream, semi-finished goods, not ore, cathode, or scrap. “It’s a move to support US fabricators and push back on subsidised Chinese oversupply. That matters, but this won’t unlock new mines or refineries on its own.

“Tariffs help buy time and level the playing field in the short term. What they don’t do is give investors the long-term certainty needed to underwrite capital-intensive projects. For that, we need permitting reform, demand signals, and durable policy.”

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