Copper MMI: LME and COMEX Copper Prices Align; Tariff Discussions Pending

The Copper Monthly Metals Index (MMI) exhibited minimal directional movement, recording an increase of 1.18% between July and August. Current copper prices remain only marginally above the lows observed in April.

COMEX Copper Prices Decline Sharply Following Unexpected Tariff Announcement

July represented the most volatile period to date for COMEX copper prices. In a manner typical of market surprises, the U.S. government’s decision to dilute copper tariffs—applying them specifically to copper products—triggered a sharp decline in prices during the final days of the month.

Market participants initially began to factor in the possibility of tariffs early in the year. By late February, speculation regarding copper duties and a subsequent investigation into copper imports emerged. The prevailing expectation was that tariffs would be imposed broadly across all forms of copper, including refined copper, copper input materials, and copper products. This anticipation exerted a notably bullish effect on the COMEX contract, resulting in a divergence between COMEX and LME prices.

In July, the U.S. not only confirmed the imposition of tariffs but also announced a duty rate of 50%, effective August 1. This rate and timing surpassed the majority of market expectations in both magnitude and immediacy.

Significant Movements in Copper Prices

• U.S. copper producer prices for grades 110 and 122 recorded the most significant increases within the overall index, rising by 10.82% to reach $6.66 per pound as of August 1.
• U.S. copper producer prices for grade 102 similarly increased by 10.38%, reaching $6.91 per pound.
• Korean copper strip prices exhibited modest upward movement, increasing by 2.76% to $11.97 per kilogram.
• Conversely, Chinese copper wire prices declined by 2.83%, settling at $10,879 per metric ton.
• Indian primary cash copper prices decreased by 3.84%, falling to $10.10 per kilogram.

Source: Metal Miner