What’s Next for Metals and Trade as Tariff Deadlines Loom?

Markets are in flux as the latest US tariff deadlines strike, impacting copper, steel, aluminum, and cross-border trade policy. The world’s metals markets are reeling from historic volatility, with copper futures plunging nearly 20% in a single day after President Trump’s decision to exempt raw copper from 50% tariffs stunned traders. Now, as further deadlines loom, the path ahead is far from clear.

Price swings have become the new norm, from warehouses in Texas to trading floors in London and Shanghai. Governments and businesses worldwide are bracing for more abrupt rule changes while legal and diplomatic fights escalate in parallel.

A Tariff Policy Whiplash

Recently, US tariffs on semi-finished copper, steel, and aluminum surged from 25% to 50% and then changed again as select exemptions and delays were implemented. Many industry leaders, expecting blanket duties, had stockpiled refined copper only for prices to collapse when the tariffs targeted downstream products instead of raw metals.

Steel and aluminum tariffs have also been doubled, with the UK among the only major traders to secure temporary leniency. Yet Canada and Mexico, the largest US metal suppliers, continue to face major risks. Canada is exploring counter-tariffs, while Mexico secured a short-term extension to protect export flows.

Did you know?
Despite the shockwaves from tariffs, the US still imports nearly half its copper, primarily from Chile, Canada, Peru, and Mexico, making complete domestic self-sufficiency years away.

An Uncertain Outlook for Metals Prices

Copper’s record price drop and the vanishing premium between US and overseas prices signal more volatility ahead. Analysts forecast further weakness in global copper prices, with LME benchmarks possibly sliding toward $9,100 per metric ton in the third quarter of 2025 before stabilizing later.

Steel and aluminum producers hiked local prices in anticipation, with US Midwest premiums and spot quotes climbing sharply to reflect new import costs.

However, these higher prices could curb domestic demand and slow investment if trade partners retaliate, potentially leading to a broader supply surplus worldwide as more metal bypasses the US for alternate markets.

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Legal and Political Battles Intensify

The legality of broad tariffs imposed under emergency statutes is now under scrutiny in federal appeals courts, with the outcome likely bound for the Supreme Court, casting a shadow over the next phase of American trade policy.

A negative ruling could force a rapid reassessment, while ongoing uncertainty leaves global businesses wary of long-term commitments.

Meanwhile, many countries are racing to negotiate last-minute trade agreements with Washington to avoid punitive duties, but progress has been slow. Extensions and targeted exemptions remain possible, but the lack of lasting deals heightens planning risks for international traders.

Global Supply Chains Rewired

Firms that rely on US-bound trade are accelerating moves to diversify sources and buyers, from Latin America to Asia. Investments in domestic rare earths and metals are ramping up in North America, but capacity gaps will take years to close.

Many European exporters, especially in Germany and France, have voiced concern over rushed new US-EU trade deals, with core sectors like autos and energy closely watching for further tariff escalations.

In Asia, India and China continue to negotiate, and further talks or deadline extensions could temporarily ease tensions but offer few guarantees as shifting rules remain a threat to long-term stability.

Safe Havens and Silver Linings

Investors seeking shelter temporarily boosted gold prices as safe-haven demand surged ahead of the August 1 deadline in metals and equity markets. Some believe ongoing uncertainty and inflation risks could maintain a strong appetite for gold and other hedges.

Meanwhile, innovators and domestic producers in the US perceive new opportunities to expand output once the market stabilizes, provided global markets do not experience a wider recession first.

The world’s trade and metal routes are in the midst of unprecedented transformation. As deal-making, legal battles, and political pressure reshape the business landscape, companies large and small must stay nimble to adapt.

More volatility is likely, and the next phase for metals and trade will be defined by who can adjust fastest in a world where tariff rules can change overnight.