Plans involve including semi-finished products, according to people familiar with the matter who asked not to be named as discussions are private. That comes as few details of Trump’s plans for copper tariffs have been revealed so far. The tariff measures haven’t yet been formalized and they could change.
It has been widely expected that refined copper would be tariffed, but it was unclear what would happen with semi-finished products — a category that includes wires, sheets, tubes and plates. Including semi-fabricated goods would ramp up the impact of the levies. Copper on Comex in New York rose as much as 1.3% in early Asia trading on Friday.
The levies, which Trump said will come Aug. 1, will have far-reaching impacts for the US. The move is expected to raise costs across a swath of the US economy due to the myriad of industries and applications reliant on the metal. Copper is used in everything from consumer electronics and automobiles to construction and the military.
Trump is pursuing the tariffs as part of his effort to bolster America’s copper supply chain, which encompasses mining, refining and processing, recycling and making semi-finished goods and end products.
Explainer: US Copper Tariffs - What’s the Idea, and Can It Work?
The biggest category imported by the US is refined copper, which has a metal content of more than 99.993%. The US imported 908,000 metric tons last year, with that raw material consumed by fabricators to make rods, cables and alloys.
North America’s biggest fabricator is Southwire Co., which supplies wires for US military installations and naval vessels. Southwire didn’t immediately respond to a request for comment.
The Copper Development Association describes copper semi-products as the key link in the US military-industrial supply chain in its March 31 submission to the US Commerce Department for this year’s copper investigation under Section 232 of the Trade Expansion Act. The industry group presented its comments on behalf of 90% of US copper semi-producers.
Domestic copper production isn’t enough for the US — forcing the country to source a significant amount of semi-finished copper from abroad. An estimated 800,000 tons of copper and copper alloy semi-fabricated products were imported last year, on top of refined copper, according to MM Markets, a consultancy working with American fabricators and recyclers.
Krisztina Kalman, the co-founder of the firm, expects the 50% tariff to extend to semi-products for security reasons. Any disturbance in foreign supply of copper and semi-finished products could expose the US to significant issues in delivering electricity, she said.
Imposing tariffs on semi-finished copper could also bring disruption to fabricators, since wire rod mills rely on primary imports and levies would drive up their costs.
“The local fabricators will not be able to produce 800,000 tons more semi-products with current capacity, and it could take up to seven years to install new capacity,” Kalman said.
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