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TD Securities says copper faces further downside as Democratic gains in the US midterm elections weaken expectations for aggressive tariffs and raise uncertainty about data-centre demand. Three-month LME copper fell to about $13,779 per tonne on Friday, its lowest level since July; mine disruptions and tight supply could cushion a decline.
TD Securities warned Thursday that copper could fall further as Democratic gains in the US midterm elections weaken expectations for aggressive import tariffs and raise doubts about projected demand from data centres. Three-month copper futures on the London Metal Exchange slid to about $13,779 per tonne late Friday in London, their lowest level since July, according to the report.
The price has retreated from an intraday peak of almost $6.80 per pound in September as traders reassess demand and the incentive to build US stockpiles. TD managing director and global head of commodity strategy Bart Melek said the metal could lose some support from US stockpiling before expected growth in data-centre consumption takes hold. He wrote that a further $500-per-tonne decline would not be a major surprise. Against Thursday’s London close of $13,843, that would amount to about 3.6%, a calculation cited in the report rather than a guaranteed forecast.
TD estimates US copper inventories at about 1.6 million tonnes. If tariff expectations ease and profitable price differences between US and overseas markets disappear, traders may have less reason to send additional metal to American warehouses. That would reduce imports, but would not automatically mean an equivalent fall in copper used by industry.
BMI, Fitch Group’s research and data unit, also identifies tariff uncertainty as a near-term price catalyst, but sees supply constraints and electrification demand as potential support. BMI forecast copper would average $13,500 per tonne this year and $12,900 in 2027. Those are the firm’s projections, not observed prices or assured outcomes.
Tariff Bets Put Stockpiles at Risk
The warning matters because US stockpiling has been one source of demand for copper, even as the metal’s longer-term outlook is tied to electrification and expanding data-centre infrastructure. If traders expect fewer tariffs, or judge the price incentive for shipping copper into the US to have faded, that particular source of buying could weaken before new consumption arrives.
That distinction is important: a slowdown in imports into US warehouses is not proof that factories, construction or power infrastructure are using less copper. But the flow of metal between markets can still affect prices and availability. The shift also creates competing risks: a less supportive US trade policy could weigh on prices, while mine disruptions and limited supply outside the US could constrain how far they fall.
The price movement is already material for market watchers. LME copper fell below $14,000 per tonne despite reports of strong Chinese demand for immediately available metal. It suggests that buying interest in one market may not fully offset uncertainty over US policy and future demand expectations.
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How US Tariffs Reshaped Copper Flows
Washington’s July 2025 copper proclamation described possible duties on refined copper: 15% from January 2027, rising to 30% in 2028, subject to a later presidential determination. Those proposed levies have not been enacted. Separate 50% duties on certain semi-finished copper products and copper-intensive derivative products took effect in August 2025.
Expectations around tariffs have already influenced trade. When Comex prices were higher than London prices, traders had a financial incentive to ship metal to US warehouses ahead of possible duties. BMI reported that Comex inventories rose about 62% from January through Wednesday; on October 30, those warehouses held about 70% of global exchange copper stocks. These figures describe inventories and their reported share, not a measure of industrial consumption.
Supply remains geographically concentrated. US Geological Survey data cited in the report show Chile supplied 68% of US refined copper imports during 2021–24, with Canada providing 16%. China, meanwhile, produced an estimated 14 million tonnes of refined copper in 2025, nearly half the global total. BMI reported that China’s Yangshan import premium topped $200 per tonne on Wednesday, the highest since records began in 2017, as buyers sought prompt supplies.
BMI has lowered its 2026 mine-production growth forecast to 1.1% from 2.4%, citing weakness in Chile and constraints at Freeport-McMoRan’s Grasberg operation in Indonesia and Ivanhoe Mines’ Kamoa-Kakula complex in the Democratic Republic of Congo. Those disruptions could limit the supply available to offset any reduction in US buying.
“With many states slated for significant AI data center development turning blue, and opposition to new construction potentially growing, AI-driven copper demand could fall meaningfully short of current projections.”
— Bart Melek, in a TD Securities note
Tariff Decision and Demand Remain Open
The election results do not themselves change the proposed refined-copper duties. The July 2025 proclamation leaves a later decision to the president, and the possible levies remain unenacted. The report does not establish whether the administration will adopt, alter or abandon them, or when a determination will be made.
It is also unclear how much future data-centre construction could be affected by political opposition, or how any change in projects would translate into copper consumption. The source material reports TD’s concerns, not a confirmed reduction in planned construction or demand. The pace of further US stockpiling is also uncertain: a fall in imports could reflect less inventory accumulation rather than weaker end-user consumption.
Finally, price forecasts are conditional assessments, not certainties. Mine disruptions could support prices, while the scale and duration of those constraints, and the balance between Chinese demand and changing US trade flows, remain developing factors.
Watch Policy and Warehouse Flows
Market attention will turn to any presidential determination on the refined-copper duties and to whether tariff expectations continue to shape the price gap between Comex and London. Changes in that spread, along with reported US warehouse inventories and import flows, can indicate whether traders still have an incentive to direct metal into the country.
Investors and industrial buyers will also be watching for updates on data-centre development and copper consumption, as well as operational news from major mines cited by BMI. The next price moves will depend on how those demand and supply signals develop; the available reports do not establish a firm timetable for either a tariff decision or a reversal in copper’s decline.
Key Questions
Why does TD Securities think copper could fall further?
TD says expectations for aggressive US copper tariffs may be weakening after Democratic gains in the midterm elections. If traders have less reason to stockpile metal in the US, that source of buying could diminish before expected data-centre demand grows.
How low does TD expect copper to go?
TD strategist Bart Melek said a further $500 per tonne drift lower would not be a major surprise. Based on the Thursday LME close of $13,843 per tonne, the report calculates that move at about 3.6%; it is not a guaranteed price target.
Have the proposed US refined-copper tariffs taken effect?
No. The July 2025 proclamation outlined possible refined-copper duties of 15% from January 2027 and 30% in 2028, subject to a subsequent presidential determination. The proposed duties remain unenacted. Separate 50% duties on certain semi-finished and copper-intensive derivative products took effect in August 2025.
What could limit a copper price decline?
BMI says mine constraints and electrification demand could cushion a correction. It cut its 2026 mine-production growth forecast to 1.1%, citing Chilean weakness and constraints at the Grasberg and Kamoa-Kakula operations.
Does lower US copper importing mean lower industrial use?
Not necessarily. Reduced imports could reflect slower stockpiling or fewer shipments encouraged by price differences, rather than an equal decline in copper consumed by industry.
Source: northernminer.com
