In this edition of Critical Minerals, Ellen Lenny-Pessagno and Peter Hütte consider how the Trump administration’s planned 50-percent tariff on copper imports will affect companies in numerous sectors and across the value chain, and offer advice on how to mitigate any potential damage.
On July 9, President Donald Trump announced plans to impose a 50-percent tariff on copper imports, effective August 1. Framed to reduce import dependency and bolster domestic supply chains, the move sent US copper futures to record highs and rattled global markets, raising new questions for industrial planners across sectors.
Copper is central to electrification and the energy transition. US consumption currently outpaces production, with 1.6 million metric tons used in 2024 compared to 1.1 million produced. Imports have filled the gap – primarily in refined and unwrought copper, which accounted for 58 percent of total copper imports last year. While the US has well-developed capabilities in copper fabrication, including wire, tube, and rod manufacturing, it remains reliant on foreign sources for raw and refined inputs.
While details of the policy remain unclear, President Trump has indicated the 50-percent tariff would apply to both refined and semi-finished copper products – materials widely used across the construction, energy, automotive, electronics, and defense sectors. For those dependent on imported copper, the policy will result in higher costs and tighter margins. Historical precedent – namely the 2018 steel and aluminum tariffs – suggests the final rate may be lower than 50 percent, but companies are already taking measures to mitigate potential damage. Metals traders are rerouting shipments to the US ahead of the August deadline.
Companies must now assess their exposure to elevated costs. For example, electric vehicle manufacturers may face tariffs on not only copper, but also on steel, aluminum, and imported EVs. Some may consider relocating parts of their supply chain to Canada or Mexico, where copper imports are not subject to the same tariffs. Others may raise prices, reduce copper in product design, or explore forward procurement to lock in lower rates. We are already seeing varied approaches over who will cover the tariffs, with some automakers absorbing the costs and others putting the onus on those companies’ supplying components with inputs containing copper.
Meanwhile, expanding domestic capacity remains a long-term challenge. Permitting delays continue to hold back new US mining and smelting projects; even new streamlined efforts offer only gradual relief. With most scrap copper in the US currently exported, some firms are now looking to ramp up domestic recovery – though this is unlikely to offset import losses in the short term. The competitive advantage in this new paradigm will go to companies with diversified sourcing strategies, those that can find less expensive substitutes for copper wherever possible, and/or those whose procurement and investment decisions are aligned with an interventionist trade regime.
None of this is hypothetical – remaining operationally resilient and cost competitive after August 1 will require up-to-date understanding of the dynamics outlined above. Veracity will continue monitoring them and what they might mean for businesses operating across the minerals value chain.