Monthly average throughput of 200,000 tons! The shadow of Trump's policies has not dissipated, and the copper market's "large tariff arbitrage trade" has resurfaced.

Noting that speculation on import tariffs has reignited a trade that once disrupted a $300 billion market, copper traders are once again scouring the globe for metals to ship to the United States. Over the past year, threats of import tariffs from U.S. President Trump have dominated the copper market, often pushing prices on the New York Mercantile Exchange (Comex) above global benchmark prices and creating significant opportunities for traders to profit by shipping metals to the U.S. In recent months, the slowdown in U.S. copper imports due to weak Comex prices making transportation unprofitable is evident. But according to several executives, the widening spread between Comex and the London Metal Exchange (LME) prices recently means traders are now shipping every available ton of copper to the U.S. Multiple industry executives suggest import volumes could rebound to historical highs of 150,000 to 200,000 tons per month. Henry Van, Industrial Metals Analysis Director at Tocqueville Group, stated, "It feels a bit dj vu. We are in the same situation as last year, with all metals being shipped to the U.S. In the near future, it is completely imaginable that our import volume will return to 200,000 tons per month." Comex near-month contract prices have surged to over $500 per ton higher than LME spot prices for the first time since last fall. This exceptional performance has been driven by investor enthusiasm for copper and speculation on the Trump administration imposing import tariffs on refined metals to protect the U.S. industry. The Commerce Secretary will need to submit a latest report on the U.S. copper market by the June 30 deadline, paving the way for tariffs starting from January 2027. According to insiders, Tocqueville Group began withdrawing hundreds of millions of dollars' worth of copper from LME warehouses last week, partly to make profits on the Comex premium. This is the largest scale of cancellation orders seen by LME since 2013. Traders note that after copper prices hit record highs above $14,500 per ton in late January, the current surge of shipments to the U.S. is injecting new catalysts into a series of bullish factors that could drive prices even higher. While copper tariff trade is rebounding, transporting metal into the U.S. is becoming more difficult. Disruptions related to the Iran conflict affecting global freight markets and exacerbating congestion in the Panama Canal have extended the time needed to transport South American copper to major U.S. ports. Gerald Taricone, Managing Director at Aliwong Investment Management Ltd., stated that mere threats of future taxation are enough to sustain the inflow. "We will see funds and goods flooding into the U.S., making the copper story even more interesting." Copper prices are currently at historic highs. London copper prices hit $13,746 per ton on Wednesday, rising about 43% in the past year. Enthusiasm for artificial intelligence has helped push Comex investor holdings to their most bullish levels since December 2020. Chinese buyers who exited the market earlier this year during price rises have re-entered since the Lunar New Year holiday. Traders suggest that if Trump decides to impose tariffs on refined copper, the impact could squeeze LME supplies. If the U.S. effectively implements the Commerce Department's proposal to impose a 15% tariff from January 2027, this impact could intensify. This could create a window in the latter half of this year, when traders will have significant incentives to ship copper to the U.S. Nicholas Snowden, Chief Metal Economist at Mocore Energy Group, stated that markets outside the U.S. are facing a supply deficit, with Chinese stocks beginning to decline. "The focus of this deficit will likely shift to LME. It's just a matter of time," he said. "If tariffs are confirmed beginning next year, LME destocking in the third and fourth quarters will be very strong."