US Copper Grab Disrupts Global Supply Chains

Copper, a commonplace material, is increasingly being pushed toward the center of global competition by the United States’ tariff cudgel.

A key juncture is now approaching: The U.S. Department of Commerce must submit its latest copper market report by June 30, including a recommendation on whether the United States should impose import tariffs on refined copper.

The markets widely expect Washington to introduce a phased tariff on refined copper, starting at 15% in 2027 and rising to 30% by 2028.

Beyond the upstream sector of refined copper, the U.S. government was already brandishing the tariff cudgel last August, imposing a blanket 50% tariff on semi-finished copper products and derivatives with high copper content.

The markets reacted swiftly: American imports of refined copper surged to approximately 1.4 million tons in 2025, nearly 800,000 tons more than in a normal year.

Since May 2026, the trend has intensified. The price gap between copper futures on the Commodity Exchange and the London Metal Exchange has continued to widen, with the former at one point exceeding the latter by about $400 per ton, before peaking at $500.

This means that shipping copper to the United States for sale is far more profitable than selling it anywhere else.

As a result, American traders have gone into a copper-grabbing frenzy, shipping every ton they can find to the United States.

On May 22 alone, more than 50,000 tons of copper were withdrawn from LME warehouses and shipped to the United States, marking the largest single concentrated withdrawal since 2013.

This copper rush has led to record-breaking copper inventories in U.S. warehouses. As of May 29, COMEX copper inventories had reached approximately 650,000 tons, an historic high.

Elsewhere, however, the situation has been rather different. Over the same period, LME copper inventories stood at only about 389,400 tons, near monthly lows.

Goldman Sachs’ estimates have painted an even more alarming picture, with the copper supply deficit in markets outside the United States surging from 60,000 to nearly 650,000 tons.

It is the same copper, but while U.S. warehouses are full to overflowing, markets outside the United States are facing shortages.

So why has the United States now set its sights on copper?

The White House has cited a “strengthening of these critical industries,” but the deeper reason is the fact that, in the age of artificial intelligence, copper has become a strategic resource.

In November 2025, the United States Geological Survey published its 2025 List of Critical Minerals, which for the first time included 10 critical minerals such as copper.

Nvidia CEO Jensen Huang has made it very clear: Copper cables will serve as the physical backbone of data center connectivity, thanks to their zero-power consumption, low latency and extremely high reliability. Over the next five to 10 years, data center connectivity solutions will require substantial amounts of copper.

In an interview with China News Service, He Weiwen, a standing council member of the China Association of International Trade and a senior fellow of the Center for China and Globalization, said that copper is indispensable to electricity generation. Emerging industries such as supercomputing, artificial intelligence and big data consume enormous amounts of electricity.

Relevant estimates suggest that, by 2030, incremental demand from power grids and electricity infrastructure will account for more than 60% of the total increase in copper demand.

One thing worth noting: On June 1, the White House issued an executive order relaxing import restrictions on steel, aluminum and copper. The reason given was that key equipment used in agriculture, construction, industry and other sectors had been significantly affected by high tariffs, and that there was a need to mitigate the impact on these important industries.

Clearly, the U.S. government has recognized that the backlash from high tariffs is becoming apparent. As He bluntly put it, in its lowering of import tariffs on copper, the U.S. government’s “hand was forced.”

But behind all this, problems in the copper supply have already been emerging.

As He noted, global copper supplies will remain tight, at least in the medium term.

Recently, the Grasberg mine in Indonesia and the Kamoa-Kakula copper mine in the Democratic Republic of Congo have each experienced disruptions to production, and neither mine is expected to return to full capacity operation before 2028.

For 2026, Goldman Sachs has lowered its global copper mine supply growth forecast for by 350,000 tons.

The effects of these pressures on supply and demand are now being seen in prices. Several institutions have recently raised their copper price forecasts. Goldman Sachs, for example, raised its year-end copper price forecast by more than 10% to $13,735 per ton.

This copper shortage is therefore no natural disaster, as a closer look reveals. Speaking plainly, He told China News Service, “The White House’s inexplicable imposition of tariffs on copper products and derivatives has severely disrupted the normal supply and demand relationship in the global copper market.”

When a handful of major powers use tariff expectations to engineer price differences across markets and draw global copper resources toward the United States, other countries must foot the bill for that policy uncertainty.