Industrial metals prices weighed down by trade, demand fears

Copper market navigates tariff uncertainty amid tight global supply

Matières premières
Ole Hansen

Head of Commodity Strategy

This content is marketing material

Key points:

  • Copper prices remain rangebound as markets await a US decision on potential tariffs which has already disrupted global trade, triggering a sustained drop in non-US stockpiles, especially in China where demand remains strong.
  • Concerns are rising that a build-up of copper stockpiles in the US ahead of the tariffs will leave the rest of the world undersupplied of this key transition metals amid rising demand for power and its main conductor.
  • The market is expected to stay supported despite trade war related growth concerns, with downside risks being countered by supply constraints and firm demand.

The copper market continues to trade within a wide range, with some of the price action being driven by market participants trying to preempt what tariff level, if any, the US Commerce Department eventually will recommend the Trump administration apply on US imports. Just like steel and aluminium, Trump has threatened to impose a 25% duty on all copper imports—a move that could roil the global market for one of the world’s most important metals—not least considering a robust demand outlook, recently further enhanced by an energy transition which is expected to increase demand for a key conductor of power towards EVs, AI-related data centres, and cooling as parts of the world continue to get warmer.

The tariffs, designed to protect local producers and foster increased US production and refining capacity, would, however, leave US manufacturers paying much more for their metal than rivals overseas. The probe launched in February under Section 232 of the Trade Expansion Act is now expected to be ready within weeks, well ahead of the 270-day deadline, and the eventual announcement is very likely to trigger a major price adjustment in the market—not least in the spread between London and New York copper—which reflects the market's attempt to guess the eventual tariff level. Following a slump in early April to 6%, the spread has been hovering around 15% before declining to a current level around 8.5%.

The spread is currently coming down amid strong demand in China, reflected by an ongoing slump in stockpiles monitored by the Shanghai Futures Exchange and the highest premium for imported copper since December 2023. Overall, an ongoing decline in copper stocks monitored by the futures exchanges in London and Shanghai has only been partly offset by a rise in New York, albeit stockpiles there has risen to a six-year high driven by hoarding ahead of the mentioned tariff announcement. China has seen the biggest reduction during the past ten weeks, with SHFE-monitored stockpiles down 67% to just 89 kt.

 

The market worries that the current flow of copper heading towards the US ahead of the tariff announcement will be left stranded there until consumed, thereby exacerbating an already tight global market into the second half of 2025. By Q3 2025, Goldman Sachs estimates 45-60% of global reported copper inventories could be in the US, which accounts for just 6% of global refined demand—leaving the rest of the world with very low stocks of this important transition metal.

This tightness, albeit a function of trade dislocation, may in the coming months discourage new short positions driven by trade war-related growth worries from entering the market, thereby limiting the downside to the copper price through 2025.

The high-grade copper future has settled into a wide range, with USD 4 per pound having proved to offer support on numerous occasions, while the latest upside spike was mostly related to the tariff probe briefly driving the HG premium over London above 16%. In the short term, the London Metal Exchange (LME) contract offers a better insight into the global supply and demand outlook, which, according to Zijin Mining Investment Shanghai, a unit of China’s top copper miner, is currently being underpinned by the mentioned strength in China, where apparent demand growth is running near double-digit levels this year, driven by strong orders from State Grid Corp, the world’s single largest buyer of copper, and rising production of copper-intensive goods such as air-conditioning units to electric vehicles. 
High Grade Copper, first month cont. - Source: Saxo

Key takeaways from recent company earnings update


Copper producers are leaning into the structural tightness expected to emerge once the current surplus dissipates. 2025 guidance across the peer group points to mid-single-digit production growth and broadly stable unit costs, while almost every management team is accelerating de-bottlenecking or brownfield expansions rather than green-field megaprojects. Shareholder returns remain healthy, but CAPEX is inching higher as electrification-driven demand (AI data-centres, grid revamps, EVs) keeps long-cycle price expectations firm at or above USD 4 per pound. Political risk (U.S. tariff probe, Chile/Peru permitting), power availability and water stress are the main swing factors for 2026-28. With the supply wave cresting and demand accelerants such as AI/data-centre electrification piling on, copper-centric miners with shovel-ready brownfield growth and robust cost positions look well placed for the next leg higher.
Examples of copper mining ETFs and mining stocks

Recent commodity articles:

7 May 2025: Agriculture markets diverge as trade war weather and speculators reshape landscape
6 May 2025: Crude climbs as market digests OPEC hike and shale slowdown risks
6 May 2025: Gold rises as Chinese demand rebounds post-holiday
5 May 2025: 
COT Report: Dollar-selling persists; Crude length trimmed ahead of OPEC output hike
1 May 2025: 
Gold corrects sharply from record highs as Chinese demand pauses
29 April 2025: 
Copper navigates energy transition supply shocks and market turmoil
28 April 2025: 
COT Report: Continued gold selling; USD weakness drives record JPY long
25 April 2025: 
Commodities weekly Energy slump overshadows strength in gold and agriculture
23 April 2025: 
Blowout top leaves Gold in consolidation mode
22 April 2025: 
Commodities return Why allocation matters
16 April 2025: Whats next as gold hits our USD 3300 target
15 April 2025: 
COT Reports show hedge funds racing to cash post-Liberation Day
11 April 2025: 
Commodities weekly As chaos reigns whats next for markets
10 April 2025: 
YouTube Interview: Gold, silver, copper, oil - prices, supply, demand in 2025
8 April 2025: 
Golds deleveraging pullback fails to shake supportive outlook
8 April 2025: 
Golds deleveraging pullback fails to shake supportive outlook
7 April 2025: 
COT on Forex and Commodities - April 7 2025
4 April 2025: 
Commodities weekly Tariff-led recession pain triggers sharp reversal
3 April 2025: 
Tariff-related recession fears ignite widespread commodities selloff
2 April 2025: 
Commodity Outlook: Commodities rally despite global uncertainty
31 Mch 2025: 
COT Report: Ongoing USD selling amid mixed week for commodities
26 Mch 2025: 
Commodities show strength in Q1, led by a select few

Podcasts that include commodities focus:

6 May 2025: 
Bears hang in at key levels as Palantir rides the retail whirlwind
23 April 2025: 
Trump going soft on tariffs versus the direction of travel.
11 April 2025: 
US and China are slipping into an economic war
4 April 2025: 
Markets melts down as recession risks go global
1 April 2025: 
Bracing for Liberation Day

Les informations contenues sur ce site web vous sont fournies par Saxo Bank (Suisse) SA («Saxo Bank») à des fins éducatives et informatives uniquement. Ces informations ne doivent pas être considérées comme une offre ou une recommandation d'effectuer une transaction ou de recourir à un service particulier, et leur contenu ne doit pas être interprété comme un conseil de toute autre nature, par exemple de nature fiscale ou juridique.

Les transactions sur titres comportent des risques. Les pertes peuvent dépasser les dépôts sur les produits de marge. Vous devez comprendre le fonctionnement de nos produits et les risques qui y sont associés. En outre, vous devriez évaluer si vous pouvez vous permettre de prendre un risque élevé de perdre votre argent.

Saxo Bank ne garantit pas l'exactitude, l'exhaustivité ou l'utilité des informations fournies et n'est pas responsable des erreurs, omissions, pertes ou dommages résultant de l'utilisation de ces informations.

Le contenu de ce site web représente du matériel de marketing et n'est pas le résultat d'une analyse ou d'une recherche financière. Il n'a donc pas été préparé conformément aux directives visant à promouvoir l'indépendance de la recherche financière/en investissement et n'est soumis à aucune interdiction de négociation avant la diffusion de la recherche financière/en investissement.

Saxo Bank (Suisse) SA
The Circle 38
CH-8058
Zürich-Flughafen
Suisse

Nous contacter

Select region

Suisse
Suisse

Le trading d’instruments financiers comporte des risques. Les pertes peuvent dépasser les dépôts sur les produits de marge. Vous devez comprendre comment fonctionnent nos produits et quels types de risques ils comportent. De plus, vous devez savoir si vous pouvez vous permettre de prendre un risque élevé de perdre votre argent. Pour vous aider à comprendre les risques impliqués, nous avons compilé une divulgation des risques ainsi qu'un ensemble de documents d'informations clés (Key Information Documents ou KID) qui décrivent les risques et opportunités associés à chaque produit. Les KID sont accessibles sur la plateforme de trading. Veuillez noter que le prospectus complet est disponible gratuitement auprès de Saxo Bank (Suisse) SA ou directement auprès de l'émetteur.

Ce site web est accessible dans le monde entier. Cependant, les informations sur le site web se réfèrent à Saxo Bank (Suisse) SA. Tous les clients traitent directement avec Saxo Bank (Suisse) SA. et tous les accords clients sont conclus avec Saxo Bank (Suisse) SA et sont donc soumis au droit suisse.

Le contenu de ce site web constitue du matériel de marketing et n'a été signalé ou transmis à aucune autorité réglementaire.

Si vous contactez Saxo Bank (Suisse) SA ou visitez ce site web, vous reconnaissez et acceptez que toutes les données que vous transmettez, recueillez ou enregistrez via ce site web, par téléphone ou par tout autre moyen de communication (par ex. e-mail), à Saxo Bank (Suisse) SA peuvent être transmises à d'autres sociétés ou tiers du groupe Saxo Bank en Suisse et à l'étranger et peuvent être enregistrées ou autrement traitées par eux ou Saxo Bank (Suisse) SA. Vous libérez Saxo Bank (Suisse) SA de ses obligations au titre du secret bancaire suisse et du secret des négociants en valeurs mobilières et, dans la mesure permise par la loi, des autres lois et obligations concernant la confidentialité dans le cadre des divulgations de données du client. Saxo Bank (Suisse) SA a pris des mesures techniques et organisationnelles de pointe pour protéger lesdites données contre tout traitement ou transmission non autorisés et appliquera des mesures de sécurité appropriées pour garantir une protection adéquate desdites données.

Apple, iPad et iPhone sont des marques déposées d'Apple Inc., enregistrées aux États-Unis et dans d'autres pays. App Store est une marque de service d'Apple Inc.