Reuters | February 12, 2025 |

Stack of cathode copper plates. Stock image.
US President Donald Trump hasn’t yet imposed import tariffs on copper but the market is already pricing in the likelihood that the red metal will be next on the list after aluminum and steel.

The arbitrage between the CME and the London Metal Exchange (LME) contracts has blown wider in recent days, with the CME premium exceeding $1,000 per metric ton earlier this week.
Given that LME three-month copper is currently trading around $9,400 per ton, the transatlantic gap implies the market is expecting a 10% tariff at the very least.
Were Trump to go for the same blanket 25% tariffs that have been applied to imports of aluminum and steel, there is obviously further upside potential for the CME premium.
Overlooked for now is how Doctor Copper would likely react to an escalating tariff war with all the negative implications for global growth.

Mind the widening gap
The aluminum tariff trade is playing out in the CME’s US Midwest premium contract because the CME’s underlying aluminum contract mirrors the LME’s international delivery status.
The CME copper contract, by contrast, is customs cleared with only domestic delivery locations, meaning it must reflect any inherent premium for US delivery.
That makes the CME premium over its international London peer a tradable gauge of any potential US tariffs on copper imports.
And right now it is trading at record highs, eclipsing even last year’s short squeeze blow-out.
CME copper stocks have recovered from the depleted levels that helped fuel that squeeze and now total over 100,000 tons.
But US consumers are highly vulnerable to any tariff barriers since the country is still reliant on imports for around 45% of domestic consumption, according to the US Geological Survey (USGS).
Hence the price sensitivity to Trump’s tariff threats, although what level of tariffs may be applied and against which countries remains a known unknown for now.
The blanket nature of this week’s announced tariffs on aluminum and the potential for even higher duties in the event of retaliation by trading partners has evidently spooked the copper market, forcing the arbitrage ever wider.
Damage impact
The immediate focus of the copper tariff trade is refined metal, which is understandable given that the United States imported just over 800,000 tons in 2024, compared with domestic production of 850,000 tons, according to the USGS.
However, trade flows would adjust over time and the CME premium is already providing an incentive for more metal to head to the United States.
The tariff impact could be much messier when it comes to copper products, given the complex flows of material between the United States and its Canadian and Mexican neighbours, both of which are threatened with 25% tariffs.
The United States exports copper wire to Mexico to be manufactured into automotive parts such as wiring harnesses and electric motors which are then shipped back across the border.
This trade amounts to 220,000 tons of contained copper each year, according to analysts at Project Blue. Slapping high tariffs on such imports is likely to see harness assembly relocate from Mexico to lower-cost Asian countries with negative knock-on effects for both Mexican and US companies in the automotive supply chain.
Both Mexico and Canada are also key suppliers of copper scrap to American processors, meaning tariffs could potentially divert flows to other countries, most likely China, to the detriment of domestic US secondary production.
Tariff drag
The interconnectedness of North American copper flows is just part of a bigger complex globalized picture, leaving the metal highly vulnerable to the sort of shift in trading patterns likely to ensue from US tariffs.
Doctor Copper has earned the honorific title precisely because the metal is so embedded in the global industrial economy.
Clearly, the potential for tit-for-tat tariffs between the United States and its trading partners could act as a major drag on consumption.
This has not yet been priced in by the market. The LME copper price has risen by 7% since the start of January, fuelled by expectations of improved demand, particularly in China.
But China is also in the cross-hairs of the new Trump administration along with just about everyone else.
If the tariff wars have begun, copper is going to be a casualty. But that will be reflected in the international price rather than the US price, implying a further fracturing between CME and LME markets.
(The opinions expressed here are those of the author, Andy Home, a columnist for Reuters.)
(Editing by Sharon Singleton)
Storied Peruvian executive resurfaces at Canadian copper startup
Bloomberg News | February 14, 2025 |

Víctor Gobitz, president of Antamina and of the Directive Council of the Peruvian Institute of Mining Engineers. (Image by PERUMIN.)
After decades overseeing some of Peru’s biggest mines, Victor Gobitz has reemerged at the helm of a Canadian startup that has plans to begin copper production in a year and go public in the medium term.

Gobitz stepped down as chief executive officer of a mine owned by BHP Group and Glencore Plc to lead Quilla Resources Inc., a firm he set up along with one family based in the UK and another in Peru.
Quilla acquired a company from Nexa Resources SA in a bid to restart the Chapi copper mine in Peru. The new owner plans to start producing cathode in the first half of next year at an annual rate of about 10,000 metric tons.
The mine, south of the Peruvian city of Arequipa, was halted in 2012 due to declining metal prices and operational challenges. Average copper prices have risen about 15% since then, partly due to additional demand from the shift away from fossil fuels, when big new deposits are getting harder to find, develop and finance.
Gobitz, whose two daughters are also involved in his new Toronto-based venture, looks to use cash from the Chapi restart to finance work on other opportunities for the 26,000-hectare (64,000-acre) land package — which isn’t far from a giant mine owned by Freeport-McMoRan Inc.
“We’ll be a closely held company for a time — until we restart operations — and then we’ll evaluate going public,” he said in an interview Wednesday. “We believe the potential is there to find a deposit of large dimensions.”
(By James Attwood)
McEwen Copper requests major tax breaks for Los Azules mine in Argentina
Reuters | February 12, 2025 |

The Los Azules copper project sits in the Andes Mountains at an elevation of 3,500 metres. Credit: McEwen Mining.
Canadian miner McEwen Copper, a subsidiary of McEwen Mining, has submitted a request to join an Argentine government incentives program that would give it significant tax breaks for its Los Azules copper project in San Juan province, it said.

McEwen plans to invest $2.7 billion in the mine. It has committed $227 million under the Argentine government’s Large Investment Incentive Regime (RIGI) to carry out the mine’s feasibility study, do exploration works, and prepare for construction.
The company could pour an additional $2.5 billion into the site to build the mine and production facilities under the incentives mechanism if approved, it said in a statement late on Tuesday.
Once the government gives McEwen the green light, its corporate tax rate for the Los Azules project will fall from 35% to 25%, and it will be exempt from value-added tax during construction and from export duties.
“Argentina is once again opening its doors to business activity,” said Robert McEwen, head and top stakeholder in McEwen Mining.
Los Azules could kick off construction in early 2026, pending environmental permits, a feasibility study and the RIGI tax approval, the firm said.
The mine is one of Argentina’s prime copper projects, located 3,500 meters above sea level in the Andean mountain range.
Argentina is mineral rich and could be key to meeting growing demand for copper due to the energy transition, but it has not produced the metal since 2018 when the Alumbrera mine was shuttered.
(By Lucila Sigal and Kylie Madry; Editing by Jan Harvey)
Reuters | February 12, 2025

First Quantum’s Kansanshi mine in Zambia.
First Quantum Minerals will not rush into a deal to sell a minority stake in its Zambian copper mines, CFO Ryan MacWilliam told analysts on Wednesday after the miner’s fourth-quarter results.

The Toronto-based miner wants to secure a long-term partner at its Zambian mines and there are no “specific timelines” for the sale, he said.
“We have been consistent throughout that any arrangements we enter into in Zambia will be for the next 25 years,” MacWilliam said. “It’s really about getting the right agreement rather than a quick agreement.”
Saudi Arabian mining company Manara is in advanced talks to acquire between 15% and 20% equity in First Quantum’s Zambian assets, Reuters reported last October, citing sources. First Quantum has said it needs the money to finance output expansion at its Kansanshi operation in the northwest of the country.
The Canadian miner’s Zambian copper and nickel assets have become key to its growth after authorities in Panama shut down its then flagship Cobre Panama mine.
First Quantum wants a deal that works for its investors as well as the Zambian government, which owns a 20% stake in the assets, MacWilliam said.
(By Felix Njini; Editing by Jane Merriman)
First Quantum’s final hearings on Cobre Panama copper mine moved to 2026

Canada’s First Quantum said on Tuesday the final hearing for the Cobre Panama mine under the International Chamber of Commerce proceedings has been moved to February 2026 from September of the current year.

The mine, one of the world’s top sources of copper, was shut down in November 2023, hours after Panama’s Supreme Court declared its contract unconstitutional. The decision to close down the mine was also triggered by environmental protests against the operation.
The Canadian miner also said the government of Panama had applied to the arbitration panel, requesting an extension of its submission dates after the replacement of an external legal counsel and on the basis that the new government required time to assess the situation concerning the mine.
Last year, Reuters reported that the Canadian miner opened a voluntary retirement scheme to workers at the mine, as the company awaited for a government decision on restarting the operation.
(By Tanay Dhumal; Editing by Anil D’Silva)
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