London copper on Wednesday lingered near a three-week low hit in the last session as US President Donald Trump’s threat to levy tariffs on copper imports kept the market under pressure.
Benchmark copper on the London Metal Exchange (LME) was unchanged at $8,993 a metric ton, as of 0426 GMT, after touching its lowest since Jan. 8 in the previous session.
The lack of clarity around US trade tariffs is creating uncertainty about demand for industrial metals, so that’s a key headwind for the year, said Soni Kumari, a commodity strategist at ANZ.
Tariff concerns have resurfaced after Trump said on Monday he would impose tariffs on aluminium and copper - metals needed to produce US military hardware - as well as steel, to entice producers to make them in the United States.
The United States imports 38% of its copper needs and is highly dependent on aluminium imports, with supplies from other countries such as Canada and Mexico covering 82% of its annual consumption, according to BNP Paribas.
The White House said on Tuesday that Trump still plans to issue 25% tariffs on Canada and Mexico on Saturday while weighing fresh tariffs on China.
Looking ahead, attention will be on clear indications from the United States about tariffs, as well as what steps China will take in its National People’s Congress meeting in March, Kumari said.
China is the top metals consumer but its economic growth has been lagging despite recent stimulus measures, particularly due to a prolonged property sector crisis.
Meanwhile, the Federal Reserve will conclude its two-day policy meeting later in the day, where it is expected to hold interest rates steady.
Comex copper premium vs LME expands after Trump tariff threat
Three-month aluminium was down 0.2% at $2,567.5.
Zinc fell 0.7% to $2,757 a ton and nickel fell 0.3% to $15,390, while lead steadied at $1,935.5 and tin was up 0.4% to $29,790.
The Shanghai Futures Exchange will be closed until Feb. 4 for the Lunar New Year holiday.
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