The global metals industry is closely monitoring tariff changes in the US, and monitoring reciprocal tariff changes from impacted geographies. The impact of tariff changes are felt through the value chain, from the scrap yard to the mine, and tariffs change material flows. Lower level % tariffs are of course ‘easier’ for the value chain to absorb, and higher % tariffs of course more challenging. What isn’t clear is the short, medium and long-term impacts, partly because each company impacted has a unique place in the market. Amongst consistently high tariffs, real change is sparked – essential long-term investment, and real strategic change. For copper, the current issue is how the US administration might apply restrictions and when – and indeed if tariffs will be the chosen instrument. Industry anticipates a change in the status of copper however the jury is out as to what it will be and the extent. Restrictions, for example, on scrap exports, primary export/imports, refined products are all potentials, some restrictions are more likely than others, the longevity of the chosen controls being another factor to consider for the value chain. It is clear that to absorb changes the value chain needs time, and somewhere in the chain, there will likely need to be investments, and changes in approach.
MM Markets (mm-markets.com) are experts in the field of metals and materials markets, we closely track emerging issues such as regulations, recycling development and materials substitution.
