Trump's 50% copper tariff extended to semi-finished products, materials for US power grid and data centers may suffer heavy blow.

According to informed sources, the proposal by President Trump to impose a 50% tariff on imported copper materials will cover all kinds of copper products used in electricity grids, military equipment, and data centers. The sources added that the proposal intends to include semifinished copper products in the tariff range. However, so far, the details of Trump administration's copper tariff plan have not been fully disclosed, and there is still a possibility of adjustments to related measures. Previously, the market widely expected refined copper to face tariffs, but there has been doubt about whether semifinished products (including wire, sheets, pipes, etc.) would be taxed. If semifinished products end up being included in the tariff range, the policy impact will significantly expand. In response to this news, copper prices on the New York Mercantile Exchange rose by 1.3% in early Asian trading on Friday. Trump claims that the tariff policy set to be implemented on August 1st will have far-reaching implications for the United States. As a key raw material widely used in electronic consumer products, automobile manufacturing, construction projects, and defense industry, an increase in copper tariffs is bound to raise production costs in various economic sectors. This move is part of Trump's efforts to strengthen the U.S. copper industry chain strategy, aiming to improve the full supply chain layout from mining, smelting, processing, recycling, to semifinished and end product manufacturing. Last year, the 908,000 tons of refined copper (purity 99.993%) imported by the United States constituted the largest category of imports, which were processed into rods, cables, and alloy products. Southwire Co., the largest copper processing company in North America (supplying cables to U.S. military bases and ships), did not immediately comment on the matter. In documents submitted to the U.S. Department of Commerce on March 31st, the Copper Development Association pointed out that semifinished copper products are a key link in the U.S. military supply chain. Representing 90% of U.S. copper semifinished product manufacturers, the association expressed its views on the copper industry investigation conducted this year under Section 232 of the Trade Expansion Act. The domestic copper production in the United States cannot meet its own demand, so a large amount of copper semifinished products need to be imported from overseas. According to MM Markets, a consulting firm serving U.S. processors and recyclers, apart from refined copper, an estimated 800,000 tons of copper and copper alloy semifinished products were imported by the U.S. last year. Co-founder of the company, Krisztina Kalman, analyzed that considering national security, the 50% tariff is likely to extend to the semifinished product sector. She stated that any interruption in the supply of foreign copper and copper semifinished products could potentially lead to significant problems in the U.S. power supply. Furthermore, taxing semifinished products will also impact processing companies, as their production relies heavily on imported billets, which will directly raise costs. "Local processing capacity cannot produce an additional 800,000 tons of semifinished products, and building new capacity may require up to a seven-year cycle," Kalman added.