Will copper prices break 10,000? The rush to import before tariffs, and the U.S. stockpiling craze may trigger a global copper inventory crisis

Global copper prices have continued to rise recently, with the London Metal Exchange (LME) copper price approaching the $10,000 per ton mark. Market concerns over the Trump administration's expected tariffs on copper have triggered a rush for U.S. imports, and this "copper scramble" may lead to a severe imbalance in global copper inventory distribution, causing a new round of turbulence in the metal market.

Currently, the London copper price has risen to its highest level since October, now reported at $9,797 per ton, an increase of nearly 12% this year. Citigroup stated that within the next three months, copper prices will break through the $10,000 per ton barrier, and the global copper market will remain tight until the U.S. import tariff policy is clarified.

Goldman Sachs indicated that by the end of the third quarter, the rise in copper prices will cause U.S. copper inventories to surge from the current 95,000 tons to at least 300,000 to 400,000 tons, accounting for 45-60% of global reported inventories, and maintained its forecast that the average LME three-month copper price will reach $10,200 per ton in the third quarter.

U.S. Copper Inventory May Surge Significantly, Supply-Demand Mismatch and Tariff Expectations Dominate Price Trends

In late February, according to CCTV news, Trump ordered a national security investigation into U.S. copper imports. This move is seen as the first step toward imposing potential tariffs on the metal, which has already triggered a surge in U.S. copper imports, with traders scrambling to stockpile copper resources ahead of possible tariff policies. Goldman Sachs analysts expect:

"U.S. copper imports may increase by 50% or even 100% in the coming months. By the end of the third quarter, the rise in copper prices will cause U.S. copper inventories to surge from the current 95,000 tons to at least 300,000 to 400,000 tons, accounting for 45-60% of global reported inventories, while copper inventories in other regions will be very low."

This large-scale stockpiling behavior has created significant arbitrage opportunities. As of last week, May copper futures contracts on the Chicago Mercantile Exchange were $800 per ton higher than the corresponding contracts in London.

Citigroup analysts believe that the tight physical market outside the U.S. may continue until May/June, temporarily offsetting the price resistance brought by broader U.S. tariff announcements.

However, despite concerns about the U.S. economic outlook, industrial metal prices have remained relatively robust. The rise in copper prices is not only influenced by U.S. tariff policies but is also supported by the increasing scarcity of raw materials, as demand is growing faster than the expansion of global mines.

Goldman Sachs predicts that by 2025, the global copper market will face a supply gap of 180,000 tons, primarily due to strong electrification demand and slowing mineral supply growth. Due to seasonal factors, this supply gap is expected to concentrate in the second half of this year.

While Citigroup maintains the view that copper prices will rise in the short term, it also warns that:

"Once the U.S. copper import demand related to tariffs collapses, it is expected that copper prices may fall as the implementation of Section 232 copper tariffs approaches."

Goldman Sachs maintains its forecast that the average LME three-month copper price will reach $10,200 per ton in the third quarter and expects that the price spread for LME contracts from September to December may reach a maximum of $350 per ton in a backwardation market, a level sufficient to close the U.S. import arbitrage window Risk Warning and Disclaimer

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