Copper prices came close to record highs on Monday as investors reacted to ongoing tariff concerns and tightening global supply. The most-traded copper contracts in New York climbed to within two cents of their all-time peak of $5.20 per pound, set nearly a year ago, before settling around $5.12 by midday. This price, equivalent to approximately $11,288 per tonne, maintained a significant premium of about $1,500 over copper prices in London.

The metal, often considered a barometer of economic health due to its widespread industrial use, has surged more than 27% since the beginning of the year. The price rally has accelerated in recent weeks, following U.S. President Donald Trump’s executive order last month to investigate copper imports. The move is widely seen as a potential precursor to imposing tariffs on the metal, adding uncertainty to global trade dynamics.

Tariff Speculation Drives U.S. Copper Imports

In anticipation of possible trade restrictions, traders have been directing large shipments of copper to U.S. shores. Analysts at Mercuria, a global trading firm, estimate that approximately 500,000 tonnes of copper are currently en route to the U.S.—a sharp increase from the typical monthly import level of about 70,000 tonnes. This rush has driven up COMEX copper prices relative to those on the London Metal Exchange (LME), reflecting heightened demand in the American market.

This increase in imports also coincides with broader concerns over the supply of raw copper. Years of underinvestment in mining and refining operations have left the market with limited capacity to respond to growing demand. Mercuria forecasts a global copper supply deficit of around 320,000 tonnes this year, a shortfall that could exacerbate competition for the metal.

China’s Economic Stimulus Fuels Demand

Adding to the upward pressure on copper prices, China—the world’s largest producer and consumer of the metal—recently announced additional economic stimulus measures. While details remain limited, the policies are expected to boost infrastructure development and industrial production, further increasing the demand for copper.

China’s role in the copper market is massive, as any shifts in its domestic policy can have a ripple effect on global trade and pricing. Traders are watching closely to see how these measures influence the country’s purchasing patterns in the coming months.

With supply constraints, surging demand, and growing market speculation over potential tariffs, copper prices appear poised for continued volatility. While some analysts believe the market could stabilize if supply chains adjust, there are some warning that further disruptions or new trade barriers could push prices even higher.

The above references an opinion and is for information purposes only. It is not intended to be investment advice. Seek a licensed professional for investment advice. The author is not an insider or shareholder of any of the companies mentioned above.