Donald Trump has said that the US will impose a roughly 50 per cent tariff on copper imports, sending prices for the industrial metal soaring and escalating his global trade war.
The president said at a cabinet meeting on Tuesday that “today we’re doing copper”, adding that he believed the levy on the metal would be 50 per cent.
Howard Lutnick, US commerce secretary, said the tariff would probably be put into place by the end of July or August 1, in an interview with CNBC on Tuesday afternoon.
US copper prices soared after Trump’s announcement, with futures trading on the CME Group’s metals exchange up more than 10 per cent at above $5.50 per pound. Copper is widely used in electronics, industrial equipment and construction.
“The tariffs have come in higher than the market expected,” said Helen Amos, commodity analyst at BMO.
“I would expect the price moves higher from here,” she added, pointing out that a 50 per cent tariff would imply that US prices on the CME Group’s metals exchange should trade at a 50 per cent premium to the global price on the London Metal Exchange.
Shares in Arizona-based copper miner Freeport-McMoRan jumped more than 5.6 per cent on Trump’s announcement.
Chile is by far the biggest supplier of refined copper to the US, followed by Canada and Mexico, according to the US Geological Survey.
Trump’s threat to impose new levies on copper comes a day after he threatened 14 trading partners, including Japan and South Korea, with steep “reciprocal” levies beginning on August 1.
Trump also on Tuesday said he planned to impose tariffs of up to 200 per cent on drug imports, beginning after a transition period that could last up to a year and a half.
