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Major players in the US copper industry have called on President Donald Trump to restrict exports of ore and scrap metal rather than imposing tariffs on imports, in his efforts to boost domestic production.
Trump’s executive order in February ordering an investigation into possible copper tariffs has upended the global market, driving US prices to a huge premium to international benchmarks and spurring a global race to get copper into the country before any potential tariffs are imposed.
The order called on the secretary of commerce to make recommendations on actions “including potential tariffs, export controls, or incentives to increase domestic production.”
In public comments in response to the US government’s section 232 investigation on copper, leading companies including miner Rio Tinto Group, fabricator Southwire Co. and trader Trafigura Group suggested that the administration should instead impose restrictions on exports of copper rather than tariffs on imports.
“The Trump administration should consider implementing export restrictions on domestically produced copper concentrate and copper scrap,” wrote Rio Tinto.
Southwire, which is the US’s largest manufacturer of copper wire, said: “The administration should focus on regulatory reform and restrictions on US copper exports as the primary tools to grow the US industry.”
Significant Importer
The US is the world’s largest exporter of copper scrap and also an exporter of copper ore, known as concentrates. However, a lack of sufficient domestic processing capacity means it is also a significant importer of refined copper metal.
Any serious curbs on US scrap supplies would redraw the market for scrap, which accounts for almost a third of copper supply. US shipments of waste copper were about 600,000 tons last year, according to research from Citigroup Inc. — an amount equivalent to some of the world’s largest copper mines. More than half of that goes directly to China for processing.
While several responses called for the US to impose restrictions on exports of copper scrap, and in some cases copper concentrates, many urged the administration not to place import tariffs on copper metal.
The Copper Development Association, the trade association for the US copper industry, called for exemptions from import tariffs for raw materials “including refined copper cathodes and scrap copper.”
Trafigura, the world’s largest copper trader, argued that import tariffs should be imposed on manufactured copper products like wire rod, tube and strip, but that the administration should “keep refined copper imports free from tariffs for now, until new mining and smelting capacity has been constructed.”
US copper miner Freeport-McMoRan Inc. didn’t make any direct recommendation about tariffs, but argued the US should support free trade.
“In 2024, the US imported approximately 50% of its copper cathode demand from Chile, Canada, Peru and other countries, which is necessary to meet current demand because there is no US latent production capacity,” the miner wrote. “Promoting free and fair trade with US allies will ensure US copper supply requirements are satisfied.”
To be sure, the industry’s lobbying push doesn’t mean that the Trump administration will heed its calls.
The threat of tariffs has pushed US copper prices to large premiums to international benchmarks as traders bet that the president would impose tariffs of up to 25% on copper imports. While still large by historical standards, the premium has decreased in the past few weeks in a possible reflection of how unpredictable Trump’s tariff policies have proven.
In late March, for example, December Comex copper was trading as much as 20% above copper for delivery in December on the London Metal Exchange. As of Tuesday, that premium had narrowed to around 13%.
The industry responses included a range of other suggestions for boosting the US copper industry, including introducing tax credits, streamlining the permitting process for new mines, and imposing tariffs on imports of semi-fabricated products containing copper.
Several respondents highlighted the challenge of incentivizing investments into new US smelting capacity. There are only three copper smelters in the US, and one of them is the mothballed Hayden plant. In its submission, Asarco LLC, which owns the Hayden plant, asked for emissions testing requirements to be relaxed in order to allow it to reopen.
–With assistance from Joe Deaux, Yvonne Yue Li, James Attwood and Jennifer A. Dlouhy.
(Adds context on US scrap imports in eighth paragraph.)
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