Copper hit record highs on tariff bets and supply fears; With Washington's June 30 deadline approaching and speculators heavily long, the next 26 days could define the metal's trajectory.
Front-month copper futures on the Commodity Exchange (COMEX), a division of the New York Mercantile Exchange (NYMEX), settled at a record high of $6.649 per pound on Tuesday. The contract, however, has pulled lower since, amid the escalation in the Middle East conflict after Iran launched strikes against Kuwait and Bahrain.
The red metal’s advance has sparked debate among traders and analysts as to whether prices are reflecting a genuine tightening of supply or a market, driven by expectations surrounding tariffs, electrification and future demand growth.
The copper rally may have further legs as the Commerce Department is reviewing a framework that would impose a 15% tariff on refined copper imports, beginning on Jan. 1, 2027. And a stepped-up tariff rate of 30% will take effect a year from then.
Tracing Copper’s Price Action Through Iran Conflict
Copper futures began a downtrend at the onset of the Iran war in late February, bottomed in late March, and have been broadly trending higher since.
Copper YTD Chart
Source: TradingView
The industrial metal fell from record highs immediately after the start of the war, dragged by the double whammy of the dollar strength in the wake of the geopolitical tensions and demand concerns arising from fears of a global manufacturing slowdown. The peak-trough drop during the period was roughly 10%.
Copper’s quick rebound came on the back of two forces: Chinese, known for their commodity guzzling, began hoarding the metal, taking advantage of the low prices and a full manufacturing collapse that was initially factored failed to materialize.
The structural story reasserted itself thereafter. Data analytics company Wood Mackenzie sees copper demand rising by a quarter by 2035, thanks to emerging sectors, combined with traditional end-users. Copper is now branded as the new strategic raw material that has diverse applications such as electric vehicles (EVs), renewable energy systems, data centers, AI infrastructure and smart grids.
June 30 Deadline Looms Large
The data circled on every copper traders’ calendar is June 30, by which the U.S. Commerce Secretary Howard Lutnick has to deliver a report to the president on domestic supply and refining. The report is in response to an executive order directing a formal review of America’s dependence on imported copper. Reports suggest the proposals under discussion include imposition of a phased universal import duty of 15%, starting on Jan 1, 2027, potentially rising to 30% thereafter.
The findings will feed directly into one of the most consequential decisions in the metals market: whether to slap what are known as Section 232 tariffs on refined copper. Under Section 232 of the Trade Expansion Act, the President holds the authority to impose duties on imported goods if the Commerce Department's investigation concludes that those imports pose a threat to national security.
A June 1 Proclamation adjusting steel and aluminum tariffs touted new copper investment by companies including Rio Tinto and Wieland as proof that Section 232 tariffs were working and manufacturing data showing the fastest growth in four years as evidence the broader program was not hurting the economy. For traders watching the June 30 deadline, the signal was hard to miss: the administration is building the case for more tariffs, not fewer.
Why Are Traders On Edge?
U.S. imports of copper products included in the April 2026 proclamation was at $16.2 billion in 2026, according to U.S. Census Bureau This includes $7.2 billion worth of semi-finished copper products and $9 billion worth of copper-intensive derivative products.
Top Sources of US Copper Imports
Source: Census Bureau data accessed via Congressional Research Service
In volume terms, refined copper imports to the U.S. totaled a record 1.63 million tons, according to Benchmark Mineral Intelligence. The import surge was driven by traders frontloading fearing import tariffs on refined copper. As U.S. buyers rushed to front-run the tariff, record levels of copper purchases drove COMEX prices significantly above those on the LME, even though the two benchmarks typically trade in close alignment.
The spread currently is around $315 per ton, still a significant premium, although much narrower than the extreme numbers in the past year. The record premium was $3,000 reached in July 2026.
Despite the U.S. ranking among the top global producers, paucity of domestic smelting and refining infrastructure meant that the country exported raw materials and imported significant amounts of refined copper. According to U.S. Geological Survey data, domestic mine production yielded 1 million tons of recoverable copper in 2025 valued at an estimated $11 billion. On the other hand, reported copper consumption was at roughly 1.9 million tons. To bridge the gap between domestic production and consumption, the U.S. relies heavily on refined copper imports.
If the Trump administration proceeds with higher copper tariffs, U.S. copper prices are likely to climb further from already elevated levels. That would increase input costs for domestic manufacturers and industrial consumers, while benefiting companies that have hedged against a potential price surge.
Conversely, if the administration decides against additional tariffs, the inflated COMEX premium could unwind rapidly. As arbitrage flows normalize and stockpiling demand fades, U.S. copper prices would likely retreat toward international benchmarks, triggering a sharp narrowing of the COMEX-LME spread.
How Much of the Rally is Speculative?
The futures market's market positioning flashes a cautionary signal. As of May 26, speculative traders held more than 105,673 net long contracts on Comex copper against just 32,633 short positions, a 3:1 bullish ratio that reflects near-peak optimism. Managed money net longs, at roughly 71,000 contracts, are approaching record territory.
In crowded trades, a tariff disappointment could trigger a rapid unwind, amplifying any move lower. Speculative rallies typically unwind quickly if the underlying narrative changes. Should the Commerce Department recommend against copper tariffs, investors could rapidly liquidate bullish positions, amplifying any decline in COMEX prices and accelerating the narrowing of the premium over LME prices.
Bull Trend Intact as Tariff Deadline Looms
The HG chart shows a clean ascending channel, with price pulling back toward the 20-day SMA at $6.42. Crucially, the lower bound of the channel has consistently acted as dynamic support throughout the rally. Any sustained dip toward this level has historically attracted buyers.
The RSI at 56.38 sits in neutral territory, neither overbought nor oversold, leaving meaningful room for the next leg higher before an exhaustion signal fires. Reinforcing the bullish case, all four SMAs are in perfect descending sequence below price, each shorter-term average sitting above the next longer-term one. It is a textbook trend continuation structure.
The upcoming catalyst sharpens the setup. The market will begin pricing in the June 30 Commerce Department tariff decision in the days ahead, compressing the trade window to roughly 10-15 sessions. With positioning, technicals, and a hard catalyst aligned, the current pullback may offer the last clean entry before the next directional move.
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