US Copper Stockpile Soars to Unprecedented Levels Amid Tariff Risk

The United States is holding an unprecedented amount of copper inventory, accounting for nearly 70% of the world's combined copper inventories across major futures exchanges. This stockpile far exceeds the country's 6-7% share of global copper consumption.

Ole Hansen, head of commodity strategy at Saxo Bank, attributed this anomaly to tariff risk. The U.S. Commerce Department recommended a phased duty on imported refined copper in 2027, rising from 15% to 30% in 2028. However, the administration has yet to make a decision, leading traders to stockpile metal within the U.S. borders.

The other driver of this trend is Asia, particularly China, which has seen increased demand for copper due to its energy transition efforts. Chinese demand remains strong despite weak housing markets.

Hansen warned that if prices outside the U.S. rise enough, the arbitrage may flip, and metal could leave the country. However, last year saw a large influx of copper into the U.S. ahead of an announcement that was later postponed, with almost no subsequent exports.