LONDON: Base metals fell in London on Thursday, with copper hitting a one-month low as investors feared the new broad US tariffs would stall global growth and affect industrial demand for metals. Benchmark three-month copper on the London Metal Exchange (LME) was down 2.7% at $9,441.5 per metric ton in official open-outcry trading, after earlier hitting $9,402.5, its lowest since March 5.
“Markets are factoring in the negative demand implications of the US reciprocal tariffs and the likely tariff responses from major trading partners. We expect the downtrend to continue at least in the short term,” said BNP Paribas analyst David Wilson.
As tariff hikes hit global growth expectations, copper consumption prospects and risk appetite, Citi expects copper to retreat to $8,500 by the third quarter. BNP Paribas expects the same mark during the second quarter.
On Wednesday night, President Donald Trump announced reciprocal tariffs that raise effective import taxes to the highest levels in a century. These tariffs include additional 34% levies on US imports from China, the world’s top metals consumer. China’s Foreign Ministry urged the United States to correct its “wrongdoing”.
The White House excluded copper, for which the US administration is continuing a separate investigation on possible new tariffs, as well as aluminium and steel, already subject to 25% tariffs. It also added that other certain minerals that are not available in the US would not be subject to the reciprocal tariffs.
Meanwhile, LME aluminium lost 1.1% to $2,462 a ton in official activity after hitting $2,448, the lowest since September 13. The contract, which has been falling for 11 consecutive sessions, is also under pressure from selling by Commodity Trading Advisors (CTAs), funds that use computer models to track momentum, said a metals trader.
LME zinc slid 1.6% to $2,737 and lead dropped 0.7% to $1,955 a ton. Both touched two-month lows. Nickel fell 0.7% to $15,850 after hitting a one-month low.
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