US copper tariffs trigger massive arbitrage
The threat of US tariffs on refined copper imports is driving a highly profitable CME-LME arbitrage trade, pulling massive physical inventories into the US and risking regional shortages elsewhere.
The argument
The guest argued that the potential 15% tariff by 2027 has already caused over 1.6 million tons of refined copper to flood into the US to capture the CME premium. If the tariffs are officially confirmed, this arbitrage window will widen further, starving non-US markets of physical copper.
The thesis, stress-tested
✓ What validates it
- ✓Official announcement of refined copper tariffs on or around the July 30 deadline
- ✓CME-LME premium widening past historical averages
▸ Risks discussed
- ▸Tariffs are delayed, canceled, or come in lower than the rumored 15%
- ▸US government delays decision past the expected deadlines
Hear it yourself
"And, Natalie, if you hadn't come into the this side of the world, would you be, like, making what do they call them now? The, not fake diamonds, but the, Oh, lab grown. Diamond. Yes. Lab grown. Sorry. I couldn't find the name. Right. Is that a metal or no? That's a precious element. No. It's not a metal. It's it's carbon. But, I think I'll stick to the metal side now. I mean, looking what's happened with, diamond prices, unfortunately, I think it's a great invention, lab diamonds, for, those who want more accessibility, but it's definitely transformed the market."
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