/>iOn Feb. 25, the White House announced it will launch an investigation into the importation of copper under Section 232 of the 1962 Trade Expansion Act.
President Donald Trump signed an Executive Order instructing the U.S. Secretary of Commerce to commence an investigation into the national security impact on the import of copper in all forms. The investigation is to review the effects of imports of copper in all forms on national security, including:
- Raw mined copper
- Copper concentrates
- Refined copper
- Copper alloys
- Scrap copper
- Derivative products
Copper is one of the products the president had promised to impose tariffs on, in addition to aluminum and steel; 25 percent tariffs were announced on Feb. 10 on aluminum and steel).
The Executive Order instructs the Commerce secretary to assess the factors outlined in the federal law that calls for "domestic production for national defense; impact of foreign competition on economic welfare of domestic industries" to include:
(i) the current and projected demand for copper in United States defense, energy, and critical infrastructure sectors;
(ii) the extent to which domestic production, smelting, refining, and recycling can meet demand;
(iii) the role of foreign supply chains, particularly from major exporters, in meeting United States demand;
(iv) the concentration of United States copper imports from a small number of suppliers and the associated risks;
(v) the impact of foreign government subsidies, overcapacity, and predatory trade practices on United States industry competitiveness;
(vi) the economic impact of artificially suppressed copper prices due to dumping and state-sponsored overproduction;
(vii) the potential for export restrictions by foreign nations, including the ability of foreign nations to weaponize their control over refined copper supplies;
(viii) the feasibility of increasing domestic copper mining, smelting, and refining capacity to reduce import reliance; and
(ix) the impact of current trade policies on domestic copper production and whether additional measures, including tariffs or quotas, are necessary to protect national security.
The Executive Order was made pursuant to Section 232 of the Trade Expansion Act, which mandates the investigation must conclude within 270 days.
Far-Reaching Implications
If, after the conclusion of the investigation, tariffs are imposed on copper and its derivative products, it would have far-reaching supply and cost implications. Copper and its derivatives are in a wide variety of everyday products, such as electronic products, wiring, construction items, just to name a few.
"Like our steel and aluminum industries, our great American copper industry has been decimated by global actors attacking our domestic production," said Commerce Secretary Howard Lutnick.
