Released July 11, 2025 | SUGAR LAND
en
Written by John Egan for Industrial Info Resources (Sugar Land, Texas)--Copper prices have followed a sawtooth pattern in recent years, but with a pronounced upward trajectory, driven by surging global demand and a paucity of new supply. Earlier this week, they flirted with record territory, about $5 per pound, roughly double the price from the end of 2019.
Then President Donald Trump stepped in and announced a 50% tariff on imported copper, most of which comes from Chile, Peru and Canada, effective August 1. The announcement was initially made July 8 on the president's Truth Social platform, then confirmed the next day by Trump.
In a Truth Social post, the president noted that "Copper is necessary for semiconductors, aircraft, ships, ammunition, data centers, lithium-ion batteries, radar systems, missile defense systems, and even, hypersonic weapons, of which we are building many. Copper is the second most used material by the Department of Defense!"
The president's declaration drove prices up about 13%, the highest one-day percentage gain since the 1960s, according to Dow Jones Market Data.
On Thursday afternoon, trading in the metal stabilized around $5.60 per pound.
"A 50% copper tariff will have a significant impact to supply chains," said Joseph Govreau, Industrial Info's vice president of research for the Metals & Minerals Industry. "International mining and refining projects will be delayed due to market uncertainty, and some domestic projects may benefit from reshoring. The U.S. is a major copper miner, but imports about half of its refined copper needs. If the 50% tariff sticks, it will support development of additional refining and smelting capacity in the U.S. There are a couple of large smelter projects in the Rocky Mountain region that could benefit from the tariffs, as well as numerous copper-recycling projects."
According to London-based agency Benchmark Mineral Intelligence, U.S. consumers could pay about $15,000 per metric ton for copper starting August 1, while the rest of the world pays around $10,000.
The U.S. imports about half of the copper it uses each year. The metal, prized for its high thermal and electrical conductivity, is used in various industrial applications, including electric power, industrial manufacturing, building construction, semiconductors and data centers. Consumer goods such as cell phones and laptops also rely on copper.
Industrial Info is tracking about 1,395 copper mines under development, valued at approximately $300 billion. Industrial Info believes roughly 800 of these projects have a low probability of beginning construction on time. On the other hand, about 222 proposed projects are deemed to have a high probability of meeting their construction schedules. The value of these high probability projects is roughly $60.4 billion.
High-probability copper mining projects are located chiefly in Russia, Chile, China, Pakistan and Zambia. While Russia has the largest dollar value of copper mines under development, at about $15 billion, the U.S. is the seventh-largest market for copper mines under development, with about $2.9 billion.
Click on the image at right to see a graphic of the dollar value of copper mines under development in the five leading countries.
An arduous permitting process in the U.S. has caused development of new mines to stretch out to an average of 29 years, according to a report last year from S&P Global. The Trump administration is taking steps to shorten the permitting process, chiefly by dramatically curtailing the period for project reviews under the National Environmental Policies Act (NEPA), the bedrock federal law that has governed developments of industrial projects on federal land or waters. For more on that, see April 25, 2025, article - Flurry of DOI Moves Seek to Boost Production of Hydrocarbons, Critical Minerals. After those changes are finalized, litigation will be a near-certainty.
On February 25, Trump issued an executive order calling for an investigation into the effects of copper imports on national security, arguing that the country's dependence on foreign producers could jeopardize U.S. defense, infrastructure and technology.
"The United States faces significant vulnerabilities in the copper supply chain, with increasing reliance on foreign sources for mined, smelted, and refined copper," the order stated. "The United States has ample copper reserves, yet our smelting and refining capacity lags significantly behind global competitors."
That February order was followed by another, one month later, where the president invoked the Defense Production Act to boost production of critical minerals, including copper. For more on that, see March 24, 2025, article - Trump Order Focuses on Developing Domestic Minerals.
This week, on Wednesday, Trump confirmed his 50% tariff on copper. The move seemed to be aimed mainly at China, which is a major producer and consumer of copper. China refined about 40% of the world's copper last year, according to the International Copper Study Group (Lisbon, Portugal). As China industrializes, its demand for copper has shot up. Today, it consumes about 58% of the world's copper. That nation also is the world's largest consumer of copper, according to a report in the Australian Financial Review.
That news outlet said, "Confusion still reigns over whether the tariffs will just be applied to cathodes, plates, blocks--known as blisters--and concentrates normally produced at or near mine sites across South America, Canada, Africa and Australia, or on more processed products such as wire, tubes and even scrap metal."
If the surprise tariff declaration was aimed at China, which Trump has long criticized for a variety of reasons, there is a potential to swamp allied nations that also have a large role in the copper trade, such as Chile, Peru and Australia.
Analysts have long predicted a coming squeeze on copper, as global demand, driven by electrification, is expected to surpass production early in the next decade. Even if recycling is added to the mix, projected demand likely will outstrip supply in the next decade. For more on that, see June 9, 2025, article - IEA Flags Concerns Over Future Supply, Demand and Price of Strategic Minerals.
U.S. demand for copper is likely to zig and zag in the coming years, as Trump is committed to ending federal financial support for electric vehicles (EVs) and wind turbines, both of which use a lot of copper. However, surging demand from power companies and data centers could offset or even outstrip falling future demand from EV automakers and wind power developers. Large data centers can use up to 25 million feet of copper cable, another reason why copper prices have hit historic peaks. For more on that, see March 12, 2025, article - Exhibitors Upbeat at this Year's MINEXCHANGE Event.
While Washington and the world spend the second half of this week digesting Trump's copper tariff order, the U.S. Court of International Trade on May 28 unanimously vacated Trump's earlier tariffs, noting that the Constitution requires "all Duties, Imposts and Excises shall be uniform throughout the United States." The court further noted that the Constitution grants Congress the exclusive power to levy tariffs. While the court ruling did not specifically address copper, the court suggested its ruling could be generalized for many if not all tariffs when it wrote, "There is no question here of narrowly tailored relief; if the challenged Tariff Orders are unlawful as to Plaintiffs they are unlawful as to all."
Immediately following that court's May 28 decision, the Trump administration appealed to the U.S. Court of Appeals for the Federal Circuit, which placed the lower court's ruling on hold until the appeals court could hear and rule on the substance of the case.
Of course, Trump could, counter to his assertions, modify either the August 1 effective date of the tariff or the 50% rate on copper imports. The president has frequently reversed or reassessed his tariff announcements.
Industrial Info Resources (IIR) is the leading provider of industrial market intelligence. Since 1983, IIR has provided comprehensive research, news and analysis on the industrial process, manufacturing and energy related industries. IIR's Global Market Intelligence (GMI) platform helps companies identify and pursue trends across multiple markets with access to real, qualified and validated plant and project opportunities. Across the world, IIR is tracking more than 200,000 current and future projects worth $17.8 trillion (USD).
Then President Donald Trump stepped in and announced a 50% tariff on imported copper, most of which comes from Chile, Peru and Canada, effective August 1. The announcement was initially made July 8 on the president's Truth Social platform, then confirmed the next day by Trump.
In a Truth Social post, the president noted that "Copper is necessary for semiconductors, aircraft, ships, ammunition, data centers, lithium-ion batteries, radar systems, missile defense systems, and even, hypersonic weapons, of which we are building many. Copper is the second most used material by the Department of Defense!"
The president's declaration drove prices up about 13%, the highest one-day percentage gain since the 1960s, according to Dow Jones Market Data.
On Thursday afternoon, trading in the metal stabilized around $5.60 per pound.
"A 50% copper tariff will have a significant impact to supply chains," said Joseph Govreau, Industrial Info's vice president of research for the Metals & Minerals Industry. "International mining and refining projects will be delayed due to market uncertainty, and some domestic projects may benefit from reshoring. The U.S. is a major copper miner, but imports about half of its refined copper needs. If the 50% tariff sticks, it will support development of additional refining and smelting capacity in the U.S. There are a couple of large smelter projects in the Rocky Mountain region that could benefit from the tariffs, as well as numerous copper-recycling projects."
According to London-based agency Benchmark Mineral Intelligence, U.S. consumers could pay about $15,000 per metric ton for copper starting August 1, while the rest of the world pays around $10,000.
The U.S. imports about half of the copper it uses each year. The metal, prized for its high thermal and electrical conductivity, is used in various industrial applications, including electric power, industrial manufacturing, building construction, semiconductors and data centers. Consumer goods such as cell phones and laptops also rely on copper.
Industrial Info is tracking about 1,395 copper mines under development, valued at approximately $300 billion. Industrial Info believes roughly 800 of these projects have a low probability of beginning construction on time. On the other hand, about 222 proposed projects are deemed to have a high probability of meeting their construction schedules. The value of these high probability projects is roughly $60.4 billion.
High-probability copper mining projects are located chiefly in Russia, Chile, China, Pakistan and Zambia. While Russia has the largest dollar value of copper mines under development, at about $15 billion, the U.S. is the seventh-largest market for copper mines under development, with about $2.9 billion.
An arduous permitting process in the U.S. has caused development of new mines to stretch out to an average of 29 years, according to a report last year from S&P Global. The Trump administration is taking steps to shorten the permitting process, chiefly by dramatically curtailing the period for project reviews under the National Environmental Policies Act (NEPA), the bedrock federal law that has governed developments of industrial projects on federal land or waters. For more on that, see April 25, 2025, article - Flurry of DOI Moves Seek to Boost Production of Hydrocarbons, Critical Minerals. After those changes are finalized, litigation will be a near-certainty.
On February 25, Trump issued an executive order calling for an investigation into the effects of copper imports on national security, arguing that the country's dependence on foreign producers could jeopardize U.S. defense, infrastructure and technology.
"The United States faces significant vulnerabilities in the copper supply chain, with increasing reliance on foreign sources for mined, smelted, and refined copper," the order stated. "The United States has ample copper reserves, yet our smelting and refining capacity lags significantly behind global competitors."
That February order was followed by another, one month later, where the president invoked the Defense Production Act to boost production of critical minerals, including copper. For more on that, see March 24, 2025, article - Trump Order Focuses on Developing Domestic Minerals.
This week, on Wednesday, Trump confirmed his 50% tariff on copper. The move seemed to be aimed mainly at China, which is a major producer and consumer of copper. China refined about 40% of the world's copper last year, according to the International Copper Study Group (Lisbon, Portugal). As China industrializes, its demand for copper has shot up. Today, it consumes about 58% of the world's copper. That nation also is the world's largest consumer of copper, according to a report in the Australian Financial Review.
That news outlet said, "Confusion still reigns over whether the tariffs will just be applied to cathodes, plates, blocks--known as blisters--and concentrates normally produced at or near mine sites across South America, Canada, Africa and Australia, or on more processed products such as wire, tubes and even scrap metal."
If the surprise tariff declaration was aimed at China, which Trump has long criticized for a variety of reasons, there is a potential to swamp allied nations that also have a large role in the copper trade, such as Chile, Peru and Australia.
Analysts have long predicted a coming squeeze on copper, as global demand, driven by electrification, is expected to surpass production early in the next decade. Even if recycling is added to the mix, projected demand likely will outstrip supply in the next decade. For more on that, see June 9, 2025, article - IEA Flags Concerns Over Future Supply, Demand and Price of Strategic Minerals.
U.S. demand for copper is likely to zig and zag in the coming years, as Trump is committed to ending federal financial support for electric vehicles (EVs) and wind turbines, both of which use a lot of copper. However, surging demand from power companies and data centers could offset or even outstrip falling future demand from EV automakers and wind power developers. Large data centers can use up to 25 million feet of copper cable, another reason why copper prices have hit historic peaks. For more on that, see March 12, 2025, article - Exhibitors Upbeat at this Year's MINEXCHANGE Event.
While Washington and the world spend the second half of this week digesting Trump's copper tariff order, the U.S. Court of International Trade on May 28 unanimously vacated Trump's earlier tariffs, noting that the Constitution requires "all Duties, Imposts and Excises shall be uniform throughout the United States." The court further noted that the Constitution grants Congress the exclusive power to levy tariffs. While the court ruling did not specifically address copper, the court suggested its ruling could be generalized for many if not all tariffs when it wrote, "There is no question here of narrowly tailored relief; if the challenged Tariff Orders are unlawful as to Plaintiffs they are unlawful as to all."
Immediately following that court's May 28 decision, the Trump administration appealed to the U.S. Court of Appeals for the Federal Circuit, which placed the lower court's ruling on hold until the appeals court could hear and rule on the substance of the case.
Of course, Trump could, counter to his assertions, modify either the August 1 effective date of the tariff or the 50% rate on copper imports. The president has frequently reversed or reassessed his tariff announcements.
Industrial Info Resources (IIR) is the leading provider of industrial market intelligence. Since 1983, IIR has provided comprehensive research, news and analysis on the industrial process, manufacturing and energy related industries. IIR's Global Market Intelligence (GMI) platform helps companies identify and pursue trends across multiple markets with access to real, qualified and validated plant and project opportunities. Across the world, IIR is tracking more than 200,000 current and future projects worth $17.8 trillion (USD).
