US copper prices leap as Trump moves closer to promised tariffs

London — US copper prices surged on Wednesday after President Donald Trump moved closer to imposing tariffs on imports, while a power outage in top producer Chile also supported the wider market.

The most active May copper futures on the US Comex exchange rose 3.1% to $4.67 a lb, having touched an eight-and-a-half month peak on February 13.

It outperformed three-month copper on the London Metal Exchange, which gained 1.1% to $9,506 a tonne in official open outcry trading.

“The US copper premium over London is reflecting the pain US consumers of this important metal will have to endure should the tariffs be rolled out,” said Ole Hansen, head of commodity strategy at Saxo Bank in Copenhagen.

The premium of Comex copper over the LME spiked to $801 per tonne from $580 a day earlier, but down from a peak of $1,153 on February 13.

Trump, who previously said he planned tariffs on copper, on Tuesday ordered a probe into duties on imports of the metal critical to electric vehicles, military hardware, the power grid and many consumer goods.

“The US has no chance of beefing up their own production and refining capacity any time soon, so this looks like another own goal. Not least considering most of the copper is imported from a relatively friendly nation like Chile,” Hansen said.

The underlying copper market fundamentals are relatively soft, with inventories rising, but a power outage in Chile was also providing support, he added.

Investors have given notice to take out large amounts of copper — 85,400 tonnes over the past week — from LME warehouses, some of which analysts say will be shipped to the US.

Comex copper inventories have more than doubled over the past five months to 96,760 tonnes.

A massive power outage across Chile plunged the country’s capital, Santiago, into darkness on Tuesday, but the power grid and major copper mines slowly came back online on Wednesday.

Among other metals, LME aluminium rose 0.4% to $2,650 a ton, zinc added 0.6% to $2,828, nickel gained 1.2% to $15,525, lead climbed 0.6% to $2,004, while tin was up 0.5% at $32,925.

Reuters