Copper Climbs to Five-Month High Amid Supply Concerns and Potential US Tariffs

New York | EcoPulse24

Copper prices extended their gains in late December, with US futures climbing to about $5.5 per pound, marking their highest level in five months. This surge was fueled by mounting global supply worries and increased speculation over new US tariffs on industrial metals.

Potential Tariffs Rekindle Market Concerns
The rally followed US President Donald Trump’s renewed commitment to impose tariffs on basic industrial metals, promising to levy duties on commodity-grade copper starting next year. Currently, a 50% tariff applies to semi-finished copper products, a measure that previously triggered sharp selloffs in US copper contracts after excluding broader copper ores such as cathodes, anodes, and concentrates.

Global Supply Disruptions
Beyond trade policy, prices received strong support from notable declines in global mining output. Freeport-McMoRan suspended operations at Indonesia’s Grasberg mine - which accounts for about 3% of global supply - following a fatal accident. Fears also grew over production slowdowns in Chile and Peru, the world’s largest copper producers, due to protests and social unrest.

Impacts on the Chinese Market
In a significant development, Chilean state mining company Codelco offered record-high prices to Chinese buyers, forcing Chinese copper smelters to accept zero processing fees for 2026. This move underscores a tightening supply market and rising competition for raw material.

EcoPulse24 Analysis
Copper’s ascent reflects a combination of geopolitical and trade pressures alongside genuine supply constraints, reinforcing a positive outlook for the widely used metal in energy, infrastructure, and electrification. With ongoing uncertainty around US trade policy, copper prices remain susceptible to further volatility at elevated levels.