Copper and Zinc Climb as Trump Delays Tariffs on Canada, Mexico

The prices of copper and zinc have been on the rise in recent weeks, driven by a combination of factors including strong demand from China and the delayed implementation of tariffs on Canada and Mexico by the Trump administration. These developments have led to an increase in the prices of these base metals, which are crucial for various industries, including construction, manufacturing, and electronics.

According to data from Trading Economics, copper increased by 0.31 USD/LB or 7.89% since the beginning of 2025, reaching a price of 4.06 USD/LB by the end of the current quarter. Looking forward, analysts expect the price of copper to reach 4.29 USD/LB in 12 months. Similarly, zinc is expected to trade at 3182.34 USD/MT by the end of this quarter, with a projected price of 3384.98 in 12 months.

The delayed tariffs on Canada and Mexico, which were part of the U.S. administration's Section 232 investigation into automobile and auto parts imports, have had an impact on the global supply and demand dynamics of copper and zinc. These tariffs, if implemented, could disrupt the flow of these metals, which are crucial for the production of automobiles and other industries. The U.S. is a significant importer of both copper and zinc, with Canada and Mexico being major suppliers. The potential tariffs could lead to increased production costs for U.S. manufacturers, as they would have to source these metals from more expensive alternatives or face higher tariff costs.

In addition to the delayed tariffs, strong demand from China has also contributed to the rise in copper and zinc prices. The Chinese government's commitment to aggressive economic support measures, including both monetary and fiscal policies, has boosted consumption and increased demand for base metals like copper and zinc. This was evident in the surge of copper imports to China in December 2024, which contributed to a strong month for base metals.

However, a more significant rebound in copper and zinc prices was limited by the rally of the US dollar, driven by strong US labor data, which pressured demand for dollar-denominated commodities from foreign consumers. This highlights the importance of macroeconomic indicators and geopolitical events in influencing the trajectory of copper and zinc prices.

In conclusion, the delayed tariffs on Canada and Mexico, along with strong demand from China, have contributed to the recent rise in copper and zinc prices. While the delayed tariffs could disrupt the supply chain and impact the global supply and demand dynamics of these metals, the actual impact would depend on the specific details of the tariffs and how the market responds to them. As investors, it is essential to stay informed about these developments and consider the potential long-term effects on the prices of copper and zinc when making strategic investment decisions.