Copper Prices Rise as US-China Trade Tensions Escalate Ahead of Tariffs Deadline

Copper Prices Surge as US Tariff Decision Looms

Copper prices have advanced in New York and London, setting the stage for a significant month that will bring more clarity on the Trump administration's plans for levies on imports of the metal to the US. The US Commerce Secretary has until June 30 to provide an updated recommendation to President Donald Trump on tariffs for refined copper, the most widely traded form of the metal.

Ahead of this decision, the premium of US prices over the rest of the world has expanded once again, leading to a renewed flow of metal to American ports. This development is just one of several supportive factors that are contributing to elevated prices, with copper recording a 5% gain in May. Efforts by the US and Iran to negotiate a ceasefire have also helped drive metals higher, while enthusiasm for assets linked to artificial intelligence has spilled over to copper.

Goldman Sachs Group Inc. has boosted its price outlook for copper on the London Metal Exchange, raising its end-year forecasts by more than 10%. The bank now expects copper to finish 2026 at $13,735 a ton, up from its previous forecast of $12,465 a ton. This increased optimism is based on the bank's expectation of US stockpiling and weaker-than-expected mine supply keeping the market tight.

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The bank's base scenario assumes that the US will again delay any tariffs on refined metal. However, this decision would need to be revisited by the end of the month, as the Commerce Department shocked the copper market last year with a decision not to impose fees. Instead, the department recommended a staged introduction of levies starting at 15% on the first day of 2027.

Copper prices on the LME were up 0.4% to $13,687.50 a ton on Monday by 11:44 a.m. in Shanghai, while heading for its highest close since May 14 on Comex with a gain of 1% to $6.45 a pound. Other metals also advanced in London as investors monitored the latest developments from the Middle East. The US and Iran are still in negotiations to extend a ceasefire and reopen the Strait of Hormuz. While the chances of a deal still appear uncertain, signs of progress have eased fears about even worse disruptions for the global economy and metals demand.