A surprise 50% copper tariff sent prices surging, miners rallying, and inflation fears rising. Winners include U.S. producers; losers include EVs, appliances, and global supply chains scrambling to adapt.
Trump’s Copper Tariff Sparks Market Whiplash
Late on July 9, President Trump dropped a trade bomb: a new 50 percent duty on all copper imports starting August 1. The move sits on top of the 10 percent across-the-board tariff he introduced in April and a growing list of country-specific levies aimed at closing bilateral deficits. In letters sent this week, the White House warned more than twenty governments that failure to reach “reciprocal” deals could trigger duties of 25 to 40 percent on their exports.
Markets reacted fast. Copper futures ripped to fresh records and U.S. miners rallied, while appliance makers, EV names, and homebuilders sold off on worries about higher input costs. Equity traders saw a brief profit-taking dip in the S&P 500 before buyers rotated into materials and railroads that haul North American ore. Bond yields nudged higher as inflation expectations ticked up.
Economists figure the effective U.S. tariff rate has climbed from roughly 3 percent last year to about 13 percent today, with room to edge toward 17 percent if every announced measure lands. Goldman Sachs estimates companies will pass around 70 percent of the new cost to shoppers and absorb the rest in margins. That math adds a visible pipeline for goods inflation just as the Fed tries to guide price growth back to its 2 percent comfort zone.
Supply chains are already shifting. Asian fabricators are rerouting light assembly to ASEAN partners to dodge the steepest brackets, while U.S. buyers race to lock long-term copper offtake from Canada and Chile. Some multinationals have dusted off tariff-era playbooks from 2018 to hedge FX and commodity exposure, but many smaller firms are unhedged and bracing for squeezed cash flow.
Winners are clear: domestic copper miners, specialty steel mills, short-haul rail, and any U.S. smelter that can restart dormant capacity. Losers span appliance brands, solar installers, EV assemblers, and contractors who will see copper tubing and wiring bills jump. If targeted nations hit back, American farm commodities could face blowback in the next harvest cycle.
Near term, traders expect more volatility each time the White House singles out another sector or country. Watch July 16 CPI for the first tariff pulse, and listen closely when tariff-exposed companies guide during earnings season starting July 15. For now, portfolio managers are tilting toward materials and select energy names, keeping hedges tight in consumer cyclicals until the dust settles.
Sources:
https://www.reuters.com/business/aerospace-defense/trumps-copper-tariffs-plan-include-semi-finished-products-bloomberg-news-reports-2025-07-11/
https://www.bloomberg.com/news/features/2025-07-11/trump-s-copper-tariffs-deadline-marks-end-of-once-in-a-generation-trade
https://www.whitehouse.gov/fact-sheets/2025/04/fact-sheet-president-donald-j-trump-declares-national-emergency-to-increase-our-competitive-edge-protect-our-sovereignty-and-strengthen-our-national-and-economic-security/
https://www.whitehouse.gov/fact-sheets/2025/02/fact-sheet-president-donald-j-trump-imposes-tariffs-on-imports-from-canada-mexico-and-china/https://www.tradecomplianceresourcehub.com/2025/07/09/trump-2-0-tariff-tracker/
https://www.cfr.org/article/what-trump-trade-policy-has-achieved-liberation-day
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https://www.reuters.com/world/americas/coppers-positive-long-term-trajectory-unchanged-despite-us-tariff-barrick-ceo-2025-07-11/