Comex copper futures surged more than 5% yesterday after US President Donald Trump proposed a 25% tariff on copper imports, ING’s commodity analysts Warren Patterson and Ewa Manthey note.

COMEX copper pushes LME copper prices higher

"The move in COMEX copper also pushed LME copper prices higher. The COMEX/LME arb widened back towards $1,000/t on the back of the news. Last week, Trump instructed the US Commerce Department to mull potential copper import tariffs. The market anticipated a relatively long investigation before tariffs are implemented. The latest indications are that the copper tariff could be enforced sooner."

"China’s National Development and Reform Commission pledged to enforce production cuts in the country’s steel and oil industry. The aim would be to improve industry profitability and reduce pollution. China’s steel production remains above 1bn tonnes despite Beijing’s efforts to reduce capacity. Industry estimates suggest that cuts of around 50mt could be implemented."