Just two weeks ago, copper prices were climbing fast due to the US stockpiling ahead of new tariffs. Traders warned that new US tariffs on copper could squeeze global supply. But things turned around quickly. But now, the copper rally has reversed into a full-blown crash.
This is a direct outcome of President Donald Trump’s trade war, aka “Trump Tariffs,” that is shaking the global market. Investors now fear that the new tariffs will slow down demand for copper worldwide.
The Copper Price Shock: Traders Scramble, Markets Tumble
Bloomberg reported, on Friday, April 4, copper prices dropped sharply, along with stock markets. The fall continued till Monday. In the London Metal Exchange, copper prices sank as much as 7.7% before bouncing back slightly to $8,735 a ton.
Earlier, we saw how traders rushed to send copper to the US before tariffs hit, driving premiums as high as $500 a ton. Big players like Mercuria and Trafigura even predicted prices could reach $12,000 a ton. But things changed rapidly when Trump shortened the tariff timeline, giving buyers very few days in hand.
Because of this, copper is piling up outside the US. Global buyers have more to choose from, but many aren’t interested. With demand dropping due to tariffs, the extra supply doesn’t help.
Chile’s Price Cut Signals Looming Economic Strain
Chile, the world’s biggest copper producer, is preparing to lower its copper price estimate for 2025. It’s a telltale sign of growing global economic concerns.
According to the Wall Street Journal, Chile’s copper agency, Cochilco, held its 2025 price forecast at $4.25 per pound in February. This came after it raised the estimate from $3.85 back in May 2024.
It also kept the 2026 forecast at $4.25. Cochilco expects copper prices to stay above $4.00 per pound for the next ten years.
- But the new data show copper prices to average between $3.90 and $4 per pound this year, which is below its previous forecast.
The final figure will be announced by the end of April. However, Juan Ignacio Guzman, head of Chilean mineral consulting firm GEM, said,
“If the trade war triggers a recession, prices could tumble to as low as $3 a pound — or about $6,600 a ton.”
Chile, which produced 24% of the world’s copper last year, is now feeling the pressure.
In a separate report from the Shanghai Metals Market, we discovered that,
- Chilean Customs data showed that Chile exported 182,338 metric tons of refined copper, including 33,496 metric tons to China in March.
- Exports of copper ore and concentrate totaled 1,304,782 metric tons, with China receiving 810,135 metric tons in the same month.
Earlier this year, in January and February, Chile’s copper production dropped compared to the previous month. Exports to China also declined during that period.
Analysts Warn of More Trouble Ahead
The Bloomberg report highlighted that the worst might not be over. Max Layton, global head of commodities research at Citigroup Inc., warned that the global trade shake-up could lead to a historic market correction. Citi now expects copper prices outside the US to average $8,500 this quarter — but they also say the risk of further drops is high.
BNP Paribas SA strategist David Wilson, who had warned prices could collapse, now sees the downtrend continuing in the short term. Goldman Sachs still believes in copper’s long-term value but admits that slower global growth could delay the expected supply shortage.
Meanwhile, JPMorgan now expects the US to fall into a recession this year. UBS estimates that every 1% drop in US GDP could cut output in export-driven Asian economies like Taiwan and South Korea by up to 2%.
China’s 34% Tariff Sparks Copper Stock Rout
Copper stocks have taken a beating amid falling prices, global slowdown fears, and rising trade tensions. The sharp selloff followed news from China’s Xinhua News Agency that Beijing will impose a 34% tariff on all US imports starting April 10.
Here’s a quick look at how major mining companies are reacting:
- Freeport-McMoRan: Shares dropped 13.1% in a single day. The stock is down 24.1% this week, bringing its market value to $41.9 billion.
- BHP Group and Rio Tinto: BHP’s shares fell 9.5%, cutting its value to $107.3 billion. Rio Tinto’s dropped 6.4%, is now valued at $93.5 billion. Both saw trading volumes nearly triple the usual.
- Southern Copper: Based in Mexico, the company fell 9.6% on Friday alone, pushing its weekly loss to 16.7%. Its market value now stands at $62.4 billion.
- Zijin Mining: This Chinese mining giant lost 7.2%, dropping to a market cap of $56.9 billion. It’s one of the few firms producing over 1 million tonnes of copper a year.
- Glencore and Anglo American: Glencore dropped 11.5%, while London-listed Anglo American fell 11%. Their market caps now stand at $36.9 billion and $28.6 billion, respectively. Both are down about 20% this week.
- Canadian Miners (Teck Resources, Ivanhoe Mines, First Quantum): Canadian copper stocks saw sharp losses. Teck dropped 12.1%, Ivanhoe fell 12.6%, and First Quantum slid 12.8% as investors pulled back across the board.
- Hindustan Copper: In India, shares fell 5.4% over the past five days and are down 15.7% so far in 2025.
KNOW MORE: Copper Prices Slump Below $9,000: What Does It Mean for Global Growth?
What started as a bullish rush has turned into a brutal crash. With tariffs rising and demand shrinking, copper is now a symbol of deeper market fears. Global supply chains are out of sync, and the world’s top miners are feeling the heat. If trade tensions escalate, this copper price crash may face a difficult recovery.
