Copper’s Bull Run Turns Into a Rout as Reality of Tariffs Bites

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(Bloomberg) – Two weeks ago, copper prices were rising while traders warned that the American tariff on the metal would pressure global supplies. Now, copper bulls face one of the worst market sales ever, as the war plans to trade the broader trading of Donald Trump expectations for demand.

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The prices of minerals seen as a global economy bell decreased to more than 10 % last week, as it collapsed alongside stock markets, as the latest tariff that Trump was brought up more famous, which fears investors – and paying reprisals from China.

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On Friday, 6.3 % on the London Metal Stock Exchange was the largest since March 2020, and prices were reduced to $ 8,780 per ton. New York Comics futures have achieved us. It is a step from clouds after Trump pledged to impose a copper import tariff that helped push US prices to the highest level in late last month.

This track has already sent buyers from fleeing-with high offers from the sky for the Comex Deieldmed shipping shipping immediately dries up with US prices dropping, according to three active people in the market.

Turnabout creates an exciting background for miners, traders and investors from the Chilean capital in Santiago this week for Cesco, one of the largest annual events in the copper industry.

Traders and manufacturers are racing to charge large quantities of minerals to the United States before imposing any fees, in a direction that risk supplies to deplete and raise prices for buyers in the rest of the world. Mercuria Traders Mercuria Energy Group Ltd said. The Trafigura group last month that prices may reach $ 12,000 per ton, while copper flows are attracted to the United States.

But a choir of upscale predictions associated with the dynamic supply dynamics may have quickly made the way to Cacophony from warnings that the last defeat could get worse with the global import tariff that Trump announced last week the hammer in the United States and beyond. While America represents only about 6 % of global copper use, the broader slowdown in the United States' imports of manufactured goods can have severe severe consequences for senior consumers in China and other major industrial economies.

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“We certainly do not recommend that anyone try to pick up the fall knife,” said Max Leiton, the global head of commodity research at Citigroup Inc. “This is a major change in global trading activity, and with it, we can see the type of correction that we will remember in five, 10 or 20 years.”

Decree consequences are already in the material copper market. Only last month, traders were paying up to $ 500 per ton the highest futures for copper that could be shipped and sold easily at higher prices in the United States. This is about four or five times the normal rate, but the importers are still standing on a wealth, provided that they can get their metal to the United States before the decline in customs duties.

Many people initially believe that this will take months, but after indications it can start in a much closer, the demand for topical charges has decreased. Additional fees of $ 500 have disappeared, and there are now any bids in the market, according to three active people in the market.

As the rush in the United States apparently reach a sudden end, buyers in the rest of the world will be left with more metals available – Trump's comprehensive definitions may mean that manufacturers may want soon.

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You expect Jpmorgan Chase & Co. Now that the United States falls into the recession this year, while the UBS AG group says it is every decrease in the point in the United States, it can see Asian economies directed towards trade such as Taiwan and South Korea that production is decreased by two.

In the copper market itself, Goldman Sachs Group Inc. warns. From the escalation in the revenge definitions, the prices may keep the prices less than $ 9,000 per ton in this quarter, at least temporarily. You see Citigroup Inc. The non -American prices range from 8,500 dollars per quarter, with severely deviant risks to the negative side.

David Wilson, the chief commodity strategy in BNP Paribas, who warned late last month that copper had collapsed as soon as it was published in BNP Paribas, who warned at the end of last month that the copper had collapsed as soon as the definitions were published in the BNP Paribas, which warned last month that copper had collapsed as soon as it was released The definitions in BNP Paribas, which last month warned that copper had collapsed once, “it is clear that the markets are clear that the markets are negative effects of demanding a tariff for American ideals and potential tariffs from the main commercial partners.” “We expect at least the downward trend to continue in the short term.”

Producers-whose prices were also thrown in stock prices in the defeat of last week-point to long-term expectations that support copper, as the demand gets an increase in energy transmission and a data center boom in the United States. After all, while futures in the United States decreased since 2011 on Friday, it is only about two months.

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“No one should panic. The basics have not changed.” “Copper is necessary to reduce fossil fuel consumption.”

If the trade war has led to stagnation, prices may collapse to $ 3 per pound – or about 6,600 dollars per ton – Juan Ignacio Joseman, head of the Chilean Mineral Consulting Company. On the other hand, if Beijing interacts with more open policies towards the rest of the world, and takes over the role of the United States in recent decades, Joseman said, “There can be a copper boom and the weak final of the American economy, but not necessarily with global repercussions.”

In the long run, copper expectations are also supported by difficulties in finding new deposits and financing their development. Evi Hambro, global head of objectivity and sector at Blackrock Inc. said. The industry will need larger margins to justify the investments needed to raise the supply.

“We need to see a higher price in order to be able to encourage this investment in the new offer,” Hambro said in an interview.

– With the help of iPhone Yue Lee.

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