Trump's trade war is derailing copper rally that he kickstarted
LONDON – President Donald Trump’s pro-business agenda helped start the copper rally, and now he is upending it with protectionist trade policies that threaten to derail a boom in the world’s economies.
Copper prices are poised for their first quarterly drop since before Trump’s shock election victory sent industrial metals prices soaring as traders bought into his pledge to cut corporate tax and boost investment in aging US infrastructure.
“When Trump was elected, everybody thought his policies were going to make life easier for business,” Daniel Briesemann, an analyst at Commerzbank, said by phone from Frankfurt. “Now, we’re talking about a possible trade war and the negative effect that’s going to have on the global economy.”
Little has happened with Trump’s infrastructure plans so far, Briesemann said.
At $6 602 a metric ton on the London Metal Exchange, copper has declined almost 10% from a three-year peak in December and is set to snap six straight quarters of gains. The metal is also trading below its 200-day moving average for the first time since late 2016, when Trump was elected.
Prices fell as much as 1.9% on Monday after Chinese officials and state media talked tough over the weekend, saying the US President’s plan to impose tariffs on their exports could backfire on the US and dent sales at American corporate giants including Apple, Boeing and Intel.
LME copper stockpiles also hit the highest level in more than 10 months and spot contracts traded at steep discounts to futures, suggesting ample supply.
The risk is that Trump’s trade policies contribute to a “vicious circle” where weaker growth saps demand as rising inflation, higher interest rates and import tariffs increase costs for consumers, Briesemann said.
Comments
Research Reports
Projects
Latest Multimedia
Latest News
Showroom
Education: Consulting with member companies to obtain the optimal benefits from their B-BBEE spending, skills resources as well as B-BBEE points
VISIT SHOWROOM
Weir Minerals Europe, Middle East and Africa is a global supplier of excellent minerals solutions, including pumps, valves, hydrocyclones,...
VISIT SHOWROOM
Press Office
Announcements
What's On
Subscribe to improve your user experience...
Option 1 (equivalent of R125 a month):
Receive a weekly copy of Creamer Media's Engineering News & Mining Weekly magazine
(print copy for those in South Africa and e-magazine for those outside of South Africa)
Receive daily email newsletters
Access to full search results
Access archive of magazine back copies
Access to Projects in Progress
Access to ONE Research Report of your choice in PDF format
Option 2 (equivalent of R375 a month):
All benefits from Option 1
PLUS
Access to Creamer Media's Research Channel Africa for ALL Research Reports, in PDF format, on various industrial and mining sectors
including Electricity; Water; Energy Transition; Hydrogen; Roads, Rail and Ports; Coal; Gold; Platinum; Battery Metals; etc.
Already a subscriber?
Forgotten your password?
Receive weekly copy of Creamer Media's Engineering News & Mining Weekly magazine (print copy for those in South Africa and e-magazine for those outside of South Africa)
➕
Recieve daily email newsletters
➕
Access to full search results
➕
Access archive of magazine back copies
➕
Access to Projects in Progress
➕
Access to ONE Research Report of your choice in PDF format
RESEARCH CHANNEL AFRICA
R4500 (equivalent of R375 a month)
SUBSCRIBEAll benefits from Option 1
➕
Access to Creamer Media's Research Channel Africa for ALL Research Reports on various industrial and mining sectors, in PDF format, including on:
Electricity
➕
Water
➕
Energy Transition
➕
Hydrogen
➕
Roads, Rail and Ports
➕
Coal
➕
Gold
➕
Platinum
➕
Battery Metals
➕
etc.
Receive all benefits from Option 1 or Option 2 delivered to numerous people at your company
➕
Multiple User names and Passwords for simultaneous log-ins
➕
Intranet integration access to all in your organisation
