Copper prices hit record on London exchange as tariff fears drive stockpiling
Copper futures on the London Metal Exchange reached an unprecedented high, closing at $14,510 per tonne, as market participants anticipate expanded US tariffs on refined copper. This expectation has triggered a rush to stockpile the metal, causing inventories to diverge across major exchanges. Analysts predict prices will remain elevated until the tariff policy is finalized.
The benchmark three-month contract settled at $14,510 per tonne, with an intraday peak of $14,533, breaking the earlier January record. This surge is largely attributed to widespread expectations that the US will broaden import duties on refined copper beginning next year, prompting American buyers to secure supplies ahead of the change.
The resulting rush has created a stark split in global warehouse levels. While New York's Comex stockpiles have climbed, LME inventories have dropped to a near five-month low, and Shanghai's reserves have hit their lowest point since 2024. Analysts note that the price gap between New York and London contracts continues to offer profitable arbitrage opportunities until the tariff policy is settled, with AI-driven demand adding to the supply pressure.
Elevated copper prices could raise production costs for manufacturers of wiring, electronics, and electric vehicles, potentially passing expenses to consumers. The stockpiling scramble may also distort supply chains, leaving European and Asian buyers facing tighter availability and higher premiums. If tariffs are finalized, the current spike could ease, but until then, market volatility may persist, affecting investment decisions in infrastructure and energy transition projects.