As expected, the announcement of the president of the US, Trump, of 50% import tariffs on copper has led to agitation in the affected market. The price of copper negotiated in Comex reached a peak of almost 590 cents of dollar per pound (equivalent to $ 13,000 per ton). The price in the London Metal Stock Exchange, on the other hand, was pressured, with the American price now negotiating at a premium of almost 30% on the price of the LME, says Thu Lan Nguyen, Chief of Investigation of Currencies and Raw Materials of Commerzbank.
High tariffs on aluminum can lead to demand destruction
“Price divergence can be explained by the assumption that the copper supply in the US will become more scarce due to prohibitively high tariff national production. This is unlikely to be possible in such a short time.
“Therefore, it is very likely that tariffs lead to a decrease in copper demand in the US Lme is under pressure.
“In the short term, US companies are likely to send as much as possible as possible to the US before the deadline of August 1. The reduction of inventories in the LME and SHF Therefore, we hope that the price of copper in the LME falls even more than $ 9,500 per ton. “
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
