Copper market plummets to record lows after Trump's 50% tariff announcement

President Donald Trump provoked a collapse in the copper market after announcing a 50% tariff on processed copper products, although he exempted raw material, such as concentrate, cathodes and scrap.

According to the president, Secretary of Commerce Howard Lutnick presented a report concluding that massive copper imports represent a direct threat to the national security of the United States. The study, prepared under Section 232 of the Trade Expansion Act of 1962, had been used in the past to justify similar measures on other raw materials such as steel and aluminum.

"But despite copper being a crucial material in manufacturing and for the national and economic security of the United States, United States copper production has plummeted. Today, a single foreign country dominates global copper smelting and refining, controlling over 50 percent of global smelting capacity and holding four of the top five largest refining facilities," the proclamation signed by Trump reads. 

"The Secretary found that unfair trade practices abroad, exacerbated by overly burdensome environmental regulations at home, have hollowed out United States copper refining and smelting, caused the United States to be overly reliant on foreign copper imports, and prevent a path forward without strong corrective action."

Therefore, Trump ruled that, from August 1, 2025, all semi-finished products and copper derivatives entering the country will be subject to a high tariff of 50%.

The measure had an immediate impact on the markets: copper prices plunged 20% in a single day following the announcement.

According to The Wall Street Journal, if Wednesday's post-closing drop in futures continues into Thursday's trading day, it would be the biggest daily decline in copper since records date back to 1968.

The biggest plunge in recorded history so far occurred on Oct. 20, 1987, when the copper market plunged 12% on the famously known "Black Monday," when panic triggered a collapse in the markets.

In addition, shares of leading companies in the sector also suffered significant falls: Freeport-McMoRan, the largest U.S. copper producer, fell 9.5%, while Ivanhoe Electric, which plans to open a mine in Arizona, lost 17% of its stock market value.

Despite the plunge, experts agree that futures still have room to correct if traders believe the tariff will not be as aggressive or if negotiated exemptions, such as those sought by Chile, the main supplier of copper to the U.S., materialize.