Copper slips as US tariff decision looms over metals market

Copper prices fell on Monday, extending last week's losses, as traders weighed the possibility of US tariffs on refined copper imports and the effect such duties could have on global inventory flows.

Benchmark three-month copper on the London Metal Exchange slipped 0.20% to $14,212 a metric ton by 0313 GMT. On the Shanghai Futures Exchange, the most-traded copper contract declined 0.39% to 108,240 yuan ($16,139.57) a metric ton.

The metal sold off sharply on Thursday after it emerged that the White House has yet to decide whether to impose tariffs on refined copper imports, with officials balancing concerns over higher manufacturing costs against efforts to encourage more domestic supply.

Analysts at Chinese brokerage Everbright Futures said market attention remains fixed on the Section 232 tariff decision, expected on September 28. The broker described itself as "cautious and bearish" on copper in the near term, noting that shifts in the White House's stance have heightened uncertainty around the inventory arbitrage trade.

COMEX copper lost more than 4% last week. Stocks in COMEX warehouses declined on Friday for the first time since mid-June, slipping 0.02% from the previous day to 767,504 short tons, or 696,268 metric tons. US exchange inventories had been rising steadily on tariff-driven inflows.

Sentiment across markets was also subdued as Asian equities fell and oil prices climbed more than 2% on renewed Middle East supply concerns, adding to inflation worries ahead of policy meetings this week by the US Federal Reserve and the Bank of Japan.

Most base metals came under pressure. On the LME, aluminium rose 0.29% and nickel gained 0.10%, while zinc fell 0.53%, lead dropped 0.74% and tin lost 0.64%. On the SHFE, aluminium fell 0.50%, zinc dropped 1.40%, lead declined 1.79%, nickel lost 0.72% and tin tumbled 3.04%.

The exchange rate used was $1 = 6.7065 Chinese yuan.