Caught Between Painful Present and Optimistic Outlook: Copper’s Tariff Price Odyssey

In the world of metals, gold has all the fun these days. The precious element has soared to record-high prices in 2025, thanks to economic uncertainty transforming it into a safe-haven darling.

But the price of gold’s especially conductive cousin, copper, has been shocked up and down by the chaotic trade environment. New research suggests short-term headwinds will give way to long-term tailwinds, but the industry will have to wait until 2027 to find out.

Conductive Shock

It’s in electrical wiring, plumbing and kitchenware. It makes up 2.5% of post-1982 pennies, their copper coating enough to cast Lincoln’s profile in lustrous reddish-brown. Demand for copper, already one of the most commonly used metals in the world, has surged amid the AI computing boom and increasing use of electric cars during a global energy transition. A conventional car, for example, contains up to 50 pounds of the stuff, while a battery electric vehicle contains about 180.

Nevertheless, copper has spent this year on a price-chart rollercoaster worthy of Six Flags. President Donald Trump teased a 50% copper tariff in early July, driving per-pound prices to record highs and prompting a Herculean effort to relocate massive amounts of the metal to US shores. Not until the tariff was announced did the White House reveal it would only apply to pipes, tubes and semi-finished copper products — not the raw material. The reversal triggered a price crash of 20% in one day. All told, copper has tumbled 4.1% in the past six months, having also fallen after the administration’s Liberation Day tariffs announcement in April. Now, with China struggling to kickstart an economic recovery and US consumer sentiment souring as job creation slows, analysts at Red Cloud Securities predict copper prices will face headwinds for at least another year:

• Last week, the firm forecast a 126,000-tonne surplus of copper in 2026, and with it a 6% drop in US demand as tariffs weigh on the economy. Red Cloud already expected a 2% decline in demand this year, and the predicted surplus led the analysts to slash their 2026 copper price forecast to $3.65 per pound from $3.85.
• The future, on the other hand, still looks artificially intelligent: McKinsey predicts $7 trillion in capital outlays will be needed for data centers to handle AI processing demands by 2030. Red Cloud forecasts the related copper demand will make the metal’s surplus vanish: The firm predicts copper deficits beginning in 2027 at 19,000 tonnes and rising to 766,000 tonnes by 2030, which analysts said will help lift prices to $6 per pound.

Those are the Rules: Developers like BHP, Freeport-McMoRan, Rio Tinto, and Zijin Mining would be the top beneficiaries of the deficit, but they’re already eyeing other future roadblocks. For one, existing copper mines will produce 15% less in 2035 than they did in 2024, according to BHP. That means firms will face pressure to find and develop new mines, something that requires significant capital spending. Then there’s the fact that the US, which imports about 45% of its copper, could take a bigger swing at tariffs: The Trump administration has said it will consider 15% universal copper tariffs in 2027, and entertain doubling them a year later. That could boost prices even higher, if there’s not another flip-flop.