Copper ETF CPER Suffers $5 Billion Loss Due to Trump's Surprise Tariff Move

The Trump administration's surprise tariff on semi-finished copper products has caused a significant drop in copper prices, leading to losses for copper ETFs, including the United States Copper Index Fund (CPER), which fell 19% in after-hours trading. Other copper-exposed ETFs, such as the Global X Copper Miners ETF (COPX) and the SPDR S&P Metals & Mining ETF (XME), also declined. The tariff has resulted in a storage facility full of losing wagers, with experts estimating hundreds of millions in losses.

The Trump administration's surprise tariff on semi-finished copper products has caused a significant drop in copper prices, leading to substantial losses for copper ETFs. The United States Copper Index Fund (CPER), for instance, fell by 19% in after-hours trading on July 30, 2025 [4]. Other copper-exposed ETFs, such as the Global X Copper Miners ETF (COPX) and the SPDR S&P Metals & Mining ETF (XME), also declined.

The tariff, announced on July 30, 2025, targets pipes, tubes, and other semi-finished copper products, as well as products heavily used in copper manufacturing, such as cable and electrical components [1]. This move, intended to boost domestic manufacturing, has had the opposite effect on the market, causing a sharp decline in copper prices.

The tariff excludes copper scrap and concentrates, which are essential inputs for the domestic copper mining industry. This exclusion has led to a significant reduction in US copper prices, with analysts attributing the drop to market expectations of higher domestic prices and the diversion of shipments to other markets, such as London [1].

The tariff has also drawn criticism from industry experts, who argue that it will not significantly benefit the constrained US copper mining industry. Freeport-McMoRan, Hudbay Minerals, and Arizona Sonoran are among the companies expected to be most affected by the tariffs [1].

The tariff has also been part of a broader crackdown on international trade by the Trump administration. In addition to the copper tariffs, a 50% tariff on all U.S. copper imports and most Brazilian goods has been announced, effective August 1, 2025 [2]. This move has been criticized for potentially straining U.S.-Brazil relations and disrupting global supply chains.

Market reactions have been swift, with copper prices falling sharply and mining giants such as Rio Tinto and BHP experiencing stock declines [3]. The administration has defended the move as essential for strengthening U.S. domestic industries and ensuring long-term economic security.

The United States Copper Index Fund (CPER) has been particularly hard hit, with the ETF falling by 19.31% on July 30, 2025 [4]. The ETF's price fluctuated between $28.19 and $35.93 during the day, with a day low at $28.19 and a day high of $35.93. The ETF is expected to rise 22.27% during the next 3 months, with a 90% probability of holding a price between $34.53 and $44.76 at the end of this period [4].

Analysts have warned that the tariffs may lead to increased production costs for U.S. manufacturers who depend on imported copper and Brazilian goods. The tariffs are expected to raise domestic copper prices and disrupt industries reliant on imported copper, including construction and electronics [2].

The Brazilian government has hinted at potential retaliatory measures in response to the tariffs, though specifics have yet to be outlined [2]. The administration has not released detailed economic impact assessments, but the tariffs are expected to have a significant impact on the U.S. economy.

In conclusion, the Trump administration's surprise tariff on semi-finished copper products has caused a significant drop in copper prices and substantial losses for copper ETFs. The tariffs are part of a broader crackdown on international trade and have drawn criticism from industry experts and market analysts. The impact of the tariffs on the U.S. economy and global supply chains remains to be seen.

References:
[1] https://www.theguardian.com/us-news/2025/jul/30/trump-tariffs-copper-pipes-wiring
[2] https://www.ainvest.com/news/trump-imposes-50-tariff-copper-brazilian-goods-effective-august-1-2507/
[3] https://www.investors.com/news/copper-prices-tank-trump-import-tariffs-stock-market-responds/
[4] https://stockinvest.us/stock/CPER