Donald Trump’s proposed import tariffs have sent shockwaves through the global copper market. With just two weeks to go before the measures are expected to take effect, the $250 billion industry is gripped by uncertainty. The world’s largest copper producer, Chile’s state-owned Codelco, is warning of mounting nervousness among its business partners.

In early July, Trump announced a 50% tariff on copper imports into the U.S. starting August 1—but failed to clarify whether the duties would apply to raw ore, fully refined copper, or unfinished goods. This lack of detail has left miners and manufacturers scrambling for answers on the scope and timing of the new rules.

Codelco Raises the Alarm: Customers Are Worried

“Our customers are concerned and want to understand where this is headed,” said Codelco Chairman Máximo Pacheco. Codelco is one of the key suppliers of refined copper to the U.S. industrial sector, including the electric vehicle industry, cable manufacturers, and defense technology providers.

Pacheco emphasized that free trade benefits both sides and that Chile stands ready to increase its copper exports to support American manufacturing. However, the looming uncertainty around tariffs threatens to disrupt that supply chain.

Potential Blow to U.S. Industries

Experts warn that the proposed tariffs could hurt a wide range of vital U.S. industries—from data centers to automakers to military equipment producers. Chile currently supplies over 60% of U.S. refined copper imports, and although the U.S. does mine copper domestically, it lacks the facilities to fully refine it.

“If the U.S. truly wants to expand copper product manufacturing, it will need more copper cathodes,” said Pacheco, referring to the refined form of copper used in rods and wires. Building new smelting facilities could take years, making a swift shift toward self-sufficiency unlikely.

Meanwhile, the global copper sector is struggling to scale up production. Rising development costs and declining ore grades have made new mining projects more expensive and slower to start. Codelco stated that 11% of its cathode exports currently go to the U.S., but Pacheco admitted he still doesn’t fully understand what the U.S. is trying to achieve with this policy.

Analysts Suggest Possible Exemptions

Some analysts believe Washington may soften the blow by offering exemptions. In past trade disputes, the U.S. government has rolled back some tariffs under pressure—a pattern traders jokingly call the “taco deal” (short for “Trump always chickens out”).

One option being discussed is to apply tariffs only to semi-finished copper goods—such as wires, tubes, and strips—while allowing refined copper cathodes to remain duty-free.

“If tariffs are imposed on copper, the ripple effect on end users like data centers and the auto sector will be severe,” said Gracelin Baskaran of the Washington-based Critical Minerals Security Program.

She added that once U.S. companies feel the pressure, “it’s very likely they’ll demand a policy review, because this puts our growth agenda at risk.”


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