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| Trafigura |
Top Suppliers Push Back on Section 232 Review as U.S. Mulls Tariff Action
Chile, Canada, and Peru—accounting for 94% of U.S. refined copper and copper alloy imports—have formally opposed the United States’ ongoing probe into potential copper tariffs under the Trade Expansion Act of 1962. The three nations submitted statements to the U.S. Commerce Department, arguing that their copper exports pose no threat to U.S. national security.
The Section 232 investigation, expected to conclude by November 2025, is part of broader U.S. efforts to safeguard strategic supply chains. However, these key copper suppliers warn that any tariffs could destabilize trade, hinder industrial growth, and ultimately benefit China, the dominant force in the global copper market.
Copper Tariff Proposal Raises Economic and Strategic Concerns
The U.S. administration’s consideration of copper tariffs aligns with its broader strategy of reinforcing domestic industries amid global tensions. Yet, leading copper producer Freeport-McMoRan, which operates in the U.S., Chile, Peru, and Indonesia, has advised against tariffs, citing potential harm to the global economy.
Chile’s American Chamber of Commerce emphasized the economic and strategic benefits of Chilean copper imports to the U.S. It warned that restrictions could unintentionally shift U.S. supply dependence toward China. Canada’s government and mining industry echoed these concerns, stating that tariffs would undercut national security by weakening reliable supply chains.
Industry Proposes Targeted Alternatives to Broad Copper Tariffs
Instead of blanket tariffs, U.S. industry groups and companies have proposed strategic alternatives. Southwire and Rio Tinto are calling for regulatory reforms and targeted export restrictions on copper concentrate and scrap, aiming to encourage domestic smelting and refining.
The Copper Development Association has advocated for tariff exemptions on essential raw materials, while global trading giant Trafigura suggests placing tariffs on finished copper products like wire rod, tube, and strip—while keeping refined copper imports tariff-free until U.S. production ramps up.
Exemptions and Future Outlook
The U.S. has already exempted imports of steel, aluminium, copper, and other minerals unavailable domestically from reciprocal tariffs effective April 5, 2025. However, the final outcome of the Section 232 copper review remains critical to global trade dynamics.
With pressure mounting from major exporters and U.S. industry leaders, the Biden administration faces a pivotal decision that could reshape the future of copper supply chains.
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