Copper prices in the U.S. have long remained higher than in London, with the average price difference exceeding $350 per ton in July—enough to drive global copper supplies toward the U.S. Traders are positioning ahead of potential tariffs on refined copper that Trump may introduce.
The U.S. is experiencing its largest copper import surge in at least 12 years, as traders are rushing to bring large quantities of copper into the country ahead of President Trump’s upcoming announcement on refined copper tariffs.
Shipping data shows that more than 200,000 metric tons of copper entered the United States in July this year, marking the highest monthly level since IHS Markit began recording in 2014. Meanwhile, U.S. copper inventories have continued to rise; as of last Friday, combined inventories at the Commodity Exchange (COMEX) and the London Metal Exchange (LME) exceeded 740,000 metric tons. LME data also indicates that copper inventories in private warehouses at U.S. ports have reached approximately 110,000 metric tons.
A large influx of copper into the United States is reshaping the global supply landscape. As U.S. market prices are significantly higher than those in London, traders are rerouting copper from other regions to the U.S. to capitalize on arbitrage opportunities driven by tariff expectations.
Tariff expectations drive U.S. stockpiling of strategic metals
The Trump administration has not yet announced whether it will impose tariffs on imported refined copper. Previously, U.S. Commerce Secretary Howard Lutnick was tasked with evaluating measures on copper imports, but the government has not released a final decision after the related deadline passed at the end of June.
The core issue the market is waiting for is whether the United States will expand its existing copper tariffs to include raw copper imports, beyond semi-finished copper products and derivatives.
COMEX copper prices have long been higher than LME prices, creating a clear arbitrage opportunity. In July this year, the average spot price differential between COMEX and LME copper exceeded $350 per ton, sufficient to stimulate global copper supplies to flow toward the United States.
Michael Cuoco, Head of Metals at StoneX Financial, said: “Tariff arbitrage currently dominates the market, even surpassing demand growth itself.”
He noted that some traders believe it is better to ship copper into the U.S. in advance rather than wait for policy implementation, in order to lock in potential profits.
Currently, official COMEX copper inventories in the U.S. have risen by more than 40% this year, reaching a record high. Market estimates suggest that total U.S. copper inventories may now exceed 1 million metric tons.
Behind this hoarding behavior is the growing importance of copper as a strategic resource. As AI data centers, power grid infrastructure, electric vehicles, and the defense industry rapidly expand, global demand for copper continues to rise.
Global supply tightens as Chilean mines face weather disruptions
The U.S. stockpiling of copper is squeezing supply in other markets. Data shows that approximately 64% of global visible copper inventories are now concentrated in the U.S., while inventories at the London and Shanghai futures exchanges are below their five-year averages, indicating signs of supply tightness in the global spot market.
Meanwhile, Chile, the world's largest copper producer, has recently experienced extreme weather, affecting production at several major mining companies.
Over the past week, multiple countries in South America were hit by heavy snowfall, sudden floods, and strong winds, resulting in 13 deaths and impacting major producers such as Anglo American, Antofagasta, Lundin Mining, and Codelco.
Among these, Antofagasta’s Los Pelambres copper mine has suspended mining and processing, while Lundin Mining’s Caserones copper mine, due to damage to its power infrastructure, is expected to take two to three weeks to resume production.
Chile accounts for about one-fifth of global copper production, and any prolonged supply disruption could further push up copper prices.
ING commodities strategist Ewa Manthey said that weather events themselves may not fundamentally alter the market landscape, but they underscore the core issue facing the current copper market: supply growth is lagging behind demand.
George Cheveley, natural resources investment manager at Ninety One Asset Management, said that weather-related impacts are typically short-term factors, and what the market truly cares about is changes in U.S. tariff policies.
Natalie Scott-Gray, Senior Metals Demand Strategist at StoneX, also noted that uncertainty surrounding U.S. Section 232 tariffs, combined with declining mine output, have collectively tightened the global copper market.
Copper prices surge to historic highs as markets await Trump's decision.
Copper prices have risen steadily in recent years, reaching a historical high in June of this year of $6.70 per pound, or over $13,600 per ton.
Analysts believe that if the United States ultimately imposes tariffs on raw copper, it could trigger a new rush to ship goods; if Trump abandons the plan, it could lead to the previously accumulated large inventories re-entering the global market.
Duncan Wanblad, CEO of Anglo American, said the company is refocusing its business around copper and remains highly optimistic about long-term copper demand. He believes that global energy transition, AI infrastructure development, and electrification trends will continue to support copper demand.
StoneX expects it is not impossible for copper prices to reach new highs this year as speculative long positions increase on major exchanges. The biggest unknown in the market remains how the Trump administration will ultimately handle copper tariff policies.