Copper holds drop as traders gauge risks from US tariff policy

Copper held a modest drop, as traders weighed the risk that a US tariff on imports of refined metal may not be adopted.

Benchmark three-month futures traded near $14 340 a ton in London, after dropping 0.5% on Monday. While the prospect of a US levy has drawn vast amounts of copper into US warehouses this year — tightening conditions elsewhere — as President Donald Trump nears the halfway mark on his second term, some bulls are growing wary that he may not follow through.

“It’s all about US tariffs — the possibility of introducing tariffs is fading somewhat,” said Jiang Hang, a trader at China-Base Ningbo Group Co. “Copper would face a significant pullback if tariffs don’t come through.”

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Copper has advanced by about 15% this year, touching a record below $15,000 a ton last month, as more and more metal piled up in the US. The commodity’s advance have also been supported by optimism about increased demand given the global energy transition and data-center build-out, as well as signs of supply challenges at major pits, including lower ore grades.

BHP Group said copper production in the three months to September fell 19% from a year earlier, according to a quarterly report on Tuesday. The world’s largest miner highlighted grade declines, scheduled maintenance, and disruptions from severe weather. Full-year output guidance was unchanged.

China-Base Ningbo’s Jiang said rising expectations for US rate rises were also keeping industrial metal prices in check. After tightening policy last month for the first time since 2023, Federal Reserve officials meet next week to decide whether to pause ahead of the midterm elections or hike again.

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Copper was steady at $14 340.50 a ton on the London Metal Exchange at 10:53 a.m. in Shanghai. Other metals were flat to lower, with aluminium down 0.4% at $3,003.50 a ton.

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