The Take. The deadline everyone was trading has passed with no decision. The COMEX premium has collapsed, but the copper hasn't left. Close to 700kt of refined copper is still in US warehouses, paid for by traders who bet on a tariff. Washington has a strategic reserve it never had to buy. The rest of the world is paying for it in tight stocks and record premiums.

The checkpoint nobody marked

Washington's July 2025 copper proclamation put a 50% duty on semi-finished copper products from 1 August 2025. It left refined cathode untariffed. The proclamation required an update by 30 June 2026 on whether to phase in a refined-copper duty of 15% from 1 January 2027 and 30% from 1 January 2028.

The market counted 90 days from that update and marked the end of September as the next decision point. As of noon Beijing time on 29 September, SMM reported, nothing had been announced. SMM is careful to say this does not mean the tariff has been dropped. It is still a live option. It just no longer pays to trade it.

When we wrote on 30 August, the COMEX–LME split was the trade. ING put the peak gap at around US$2,937/t in late July 2025. SMM now has October COMEX trading at a US$46.94/t discount to LME three-month and November at a US$38.99/t premium. In SMM's reading, the arbitrage is closed.

The metal stayed

The inventory numbers from SMM's 29 September note:

  • COMEX: from about 320,000 short tons to nearly 770,000. That is roughly 699kt in metric terms (our conversion, at 0.907t per short ton).
  • SHFE: from 359,100t at the end of March to 47,100t on 24 September.
  • LME: from about 400kt in April to around 250kt.

Crux Investor estimated in September that 69% of exchange-monitored copper now sits on COMEX. Shanghai is paying for it. SMM puts the Chinese domestic premium for top-grade cathode near US$205/t (RMB 1,400), the highest since October 2023, with social inventories down to 78,300t.

SMM's phrase for the US holdings is a "de facto strategic reserve", financed by private traders and not by the US Treasury.

Who pays

Traders bought copper, shipped it and stored it on the expectation of a tariff. The trade paid while the spread was wide. Copper outside the US is short. LME copper set a record of US$14,875/t on 10 September, Crux reported, and then fell more than 4% in a single session when a report said the tariff decision had stalled. Canberra's new Resources and Energy Quarterly also credits US imports, alongside the DRC's concentrate export ban, for the LME records above US$14,700 in early September.

That is the cost: the tariff hasn't been imposed, and the policy has still moved metal and moved prices. If it is finally decided in either direction, the stock will either stay trapped behind a duty or flood back to the LME and Shanghai. Either outcome is a price shock. ING forecasts a 2026 deficit of only about 35kt. That is small enough for 700kt of US stock to swamp it if released, and for its absence to matter if not.

Water-cooler version

The tariff gamble is over, but its effects aren't. Copper producers have enjoyed record prices partly because a policy decision is still pending. Australian copper earnings are forecast in the REQ to rise from A$14 billion to A$19 billion in real terms by 2030–31. That forecast rests on a market where a quarter of a million tonnes of LME stock and 47kt in Shanghai are what's left for everyone outside the US.

The next decision from Washington, whichever way it goes, will hit the copper price.

Opinion and commentary. Facts are sourced above. Not investment advice. Do your own research.