Copper price pulls back sharply ahead of US tariff deadline

[Ben Graham]

Copper prices fell to the lowest in a week on Monday after opening the market higher, as investors continue to monitor the final details on imminent US tariffs on the metal.

The most active copper futures on the COMEX fell by nearly 3% to $5.613/lb., a sharp pullback following a record-setting rise last week that saw prices approach the $6/lb. level.

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In London, the benchmark three-month copper contract was down more than 1% at $9769.50/tonne, having risen by 0.6% earlier to $$9,824.50/tonne.

The decline comes just days before the official implementation of the touted 50% tariff on the industrial metal, the details of which remain unclear ahead of their planned start date on Friday.

The Trump’s administration so far has yet to confirm the important aspects of the duties, including which products will be covered, whether supplies from all nations will be hit equally, or how metal already on its way to US shores will be treated.

In anticipation of the August 1 deadline, global traders have been shipping massive amounts of copper to the US, triggering a last-minute scramble and a spike in prices earlier this month. While copper prices in the US are now much higher than those in London, they still do not fully reflect the 50% universal tariff rate.

Further important developments lie ahead this week, as the Federal Reserve is expect to keep rates unchanged at the conclusion of its policy meeting on Wednesday, but its commentary will be scrutinized for clues on what comes next.

(With files from Bloomberg)