Why Copper Prices Crashed in Late June 2026 and What Happens Next

2. Weak Chinese Demand

Chinese buyers did step in to "buy the dip," but the broader macro picture — slowing growth fears exacerbated by the Iran conflict — weighed on demand expectations from the world's largest copper consumer . J.P. Morgan projects copper could fall to $11,100–$11,200/mt in bearish scenarios .

3. Geopolitical Overhang

The US-Iran conflict and uncertainty about a peace deal added a layer of demand-destruction risk, with investors worried about recessionary knock-on effects . The Iran war has also disrupted global sulfur supply, a key input for copper production .

4. Tariff Uncertainty Weighing on Sentiment

The CME duty-paid premium that had built up in 2025 on expectations of US import tariffs on refined copper had already diminished by early 2026 as the market reassessed the likelihood and timing of those tariffs . This uncertainty has made it difficult for traders to price risk accurately.

The June 30 Commerce Review: The Key Catalyst

Current 50% Section 232 Tariff

Since April 6, 2026, a 50% national-security tariff has applied to refined copper, copper cathode, and downstream copper derivatives . A further proclamation on June 1, 2026 tweaked rules ahead of the pending review .

The Inflection Point

June 30, 2026 is the date the Commerce Secretary is required to deliver a market assessment and tariff recommendation to President Trump . The review is expected to propose a phased tariff increase on refined copper cathodes — potentially starting at 15% on January 1, 2027 and stepping up to 30% by January 2028 . This is the single most consequential near-term catalyst for the copper market .

Why This Matters

Refined copper was deliberately left out of the initial July 2025 tariff action . This review decides whether and how to bring it in. The outcome could significantly reshape US import flows, global copper price differentials, and the premium between CME and LME prices.

Market Fundamentals: Supply Tightness vs. Macro Fear

Despite the price slide, the underlying supply picture remains tight. Actual mine supply disruptions and AI/data-center-driven demand continue to provide a floor — copper was still over 40% higher than a year ago in mid-June . However, macro fears are currently overwhelming those fundamentals .

The CME premium over LME prices has diminished as the market reassesses the chances of US import tariffs, with the justification for import reliance appearing less persuasive now that the US possesses substantial inventory .

Corporate Adaptation: How Hailiang Turns Tariffs Into a Moat

Houston Plant Near Capacity

Zhejiang Hailiang, a major Chinese copper fabricator, operates a copper tube and bar facility in Houston that is now approaching maximum production capacity . The company began operations there in 2020 with 30,000 tonnes/year of capacity and plans to triple that to 100,000 tonnes by 2025 .

Sealy, Texas Expansion

A separate $150 million facility in Sealy, Texas (50 miles west of Houston) — registered as Hailiang Copper Texas Inc. — is in Phase 2 expansion, adding more copper production lines . When complete, the 44,000-square-meter industrial complex will have a designed production capacity of 100,000 tons per year .

The Playbook

By producing inside the US, Hailiang avoids the 50% Section 232 tariff entirely, securing premium pricing and locking in market share against both Chinese exporters and domestic competitors . Its strategy is part of a broader global footprint spanning Indonesia to Morocco, designed to navigate trade barriers .

The Bottom Line

Hailiang is an unexpected beneficiary of US tariff policy: the barriers that hurt Chinese imports actually strengthen the competitive position of Chinese-owned US-based production capacity .

Outlook Summary

The copper market is caught between bullish supply constraints (mine disruptions, AI/grid demand) and bearish macro headwinds (strong dollar, Fed tightening, China slowdown, tariff uncertainty). The June 30 Commerce review is the next pivotal event — a recommendation to phase in tariffs on refined copper could reshuffle global trade flows and widen the CME-LME spread again. Corporate moves like Hailiang's US localization illustrate that tariff barriers are accelerating onshoring by foreign producers rather than simply reducing imports.