Latest News

Sources say that Trafigura will withdraw LME copper stocks ahead of the US tariff ruling

Two industry sources have confirmed that Trafigura, the commodity trader, plans to remove large amounts of copper from London Metal Exchange's warehouses in New Orleans. They cited a U.S. Tariff decision expected late in June.

Trafigura, a Swiss company, declined to comment.

The traders have moved large volumes of copper into the United States to prepare for possible import taxes that could increase shipping costs. The threat of import levies has increased the value for existing copper stocks, as holding copper in the United States allows customers to lock in supplies at pre-tariff rates.

After a review, the United States will likely decide by late-June whether to impose tariffs on copper metal imports.

U.S. US IMPOSED A 50% TARIFF ON COPPER LAST SEASON. This was part of a larger levy imposed on semi-finished products made from copper.

Copper stored in LME-registered warehousing in the United States is usually kept in free trade zones or bonded areas, which means it hasn't entered the U.S. formally and isn't subject to import duties unless brought into the domestic market.

LME data shows that more than 30,000 tons of copper was cancelled or marked for delivery in New Orleans, Louisiana on Thursday.

LME data doesn't identify the companies responsible for inventory movement, but two sources who refused to be named said that the company was Trafigura.

The total cancellations for Thursday exceeded 50,000 tons. The majority of the remaining 22,000 tons were stored in LME warehouses located in Kaohsiung.

The total amount of cancelled LME copper stock is 391,900 tonnes, or nearly 30%. Total stock of 'copper' in approved warehouses by Comex The 574,864 metric tonnes is an increase of more than 550% from the February 2018 order by President Donald Trump to conduct a Section 232 Investigation, a process that is designed to 'determine if a product enters the U.S. In sufficient quantities, the product could threaten national security.

Since February last year, traders are withdrawing copper from LME storages Shanghai Futures Exchange Industry sources say that the best way to export to the United States is to use a container. (Reporting and editing by Barbara Lewis; Additional reporting by Eric Onstad, Pratima Deai, and Polina.

(source: Reuters)