Trump copper tariff includes potential scrap export restrictions

President Donald Trump has issued a proclamation authorizing the Secretary of Commerce to take steps under the Defense Production Act to support the domestic copper industry that could include a ceiling on the exportation of “high-quality copper scrap” and a potential copper scrap-specific licensing system.

The lead bullet point on the proclamation fact sheet involves Section 232 tariffs placed on imported semifinished copper products (such as copper pipes, wires, rods, sheets and tubes) and copper-intensive derivative products (such as pipe fittings, cables, connectors and electrical components), effective Aug. 1.

The list does not include copper cathode or anode, and the fact sheet says the copper tariff does not stack upon existing reciprocal or automotive sector tariffs.

The copper 232 tariffs apply to the copper content of a product, noncopper content of a product remains subject to reciprocal tariffs or other applicable duties, according to the White House.

The Copper Development Association (CDA), McLean, Virginia, says it is encouraged by the outcome of the 232 investigation into copper, noting that many of the recommendations it submitted on behalf of U.S. fabricators made it into the final decision, including 50 percent tariffs on imported semifinished copper products and copper-intensive derivatives and no tariffs on upstream input materials such as copper ores, cathodes, anodes, and scrap as well as targeted export controls prioritizing U.S. sales of domestically produced copper scrap and input materials.

CDA President and CEO, Adam Estelle, says, "Upon initial review, we believe the administration has taken decisive, comprehensive and calibrated actions designed to supercharge domestic production. The forthcoming details will be important to understand full impacts, but the initial framework appears to be highly aligned with the solutions recommended by CDA's fabricator members. These actions support CDA's longstanding position that copper is critical to national security, energy dominance, AI supremacy, reshoring manufacturing and restoring America's standing as an industrial superpower. Now is the time to unleash American copper like never before."

The release of the fact sheet Wednesday—and the absence of a tariff on copper cathode or anode—caused an immediate reaction in the copper exchange trading markets, where for the past several months the value of copper on the U.S.-based Comex exchange has risen against the London Metal Exchange (LME) and Shanghai Futures Exchange (SHFE), creating what traders refers to as an arbitrage situation.

“The surprise move dragged down U.S. copper prices more than 18 percent on the Comex exchange and unwound a large part of the premium over the London global benchmark that had grown in recent weeks, with shipments diverted there in anticipation of higher domestic prices," according to a Reuters report Thursday, July 31.

Reuters correspondents Lewis Jackson and Polina Devitt quote a Mumbai-based commodities hedge fund founder as predicting the LME "flips to a premium in the short term due to excess inventories in the U.S. [and] over time, Comex moves back to a premium as inventories draw and downstream tariffs leave a sustained U.S. premium."

As for recyclers, the fact sheet’s third bullet point is recycling specific, stating the new policy authorizes the Commerce Department to take steps to assure 25 percent of “high-quality copper scrap” generated in the U.S. is sold into the domestic market.

“This will improve access to this important feedstock for domestic fabricators and secondary refiners,” the White House says.

The White House also indicates the Department of Commerce has recommended an export licensing requirement for high-quality copper scrap to ensure adequate domestic supply.

Export licensing in the U.S. historically has been less comprehensive compared with many other nations.

On its website, the Commerce Department’s own International Trade Administration answers the question “Do I Need a License?” in part by writing, “The answer is usually ‘no,’ because about 95 percent of all items exported from the United States don’t require an export license. As such, only a small percentage of all U.S. export transactions require licenses from the U.S. government.”

For several decades, as much as 50 percent of red metal-bearing scrap generated in the U.S. has been exported to China and other nations in Asia. Currently, whether 25 percent or more of those exports can be considered as “high-quality” grades will depend on the measuring stick used by the Department of Commerce.

According to Commerce Department data aggregated by the U.S. Geological Survey (USGS), U.S. melt shops consumed 928,000 metric tons of copper-bearing scrap last year, with brass and wire rod mills responsible for about 86 percent of that total consumption.

Of the 928,000 metric tons consumed, 102,000 of it was imported, meaning 826,000 metric tons of domestically generated red metal scrap was melted in the U.S. in 2024.

According to USGS, U.S. recyclers and traders exported 614,300 metric tons of red metal scrap last year. Adding the domestic scrap consumption and export subtotals creates an estimated generation figure of 1,440,300 metric tons of red metal scrap accounted for in the Commerce Department data.

Based on those figures, less than 43 percent of red metal-bearing scrap generated in the U.S. last year was exported, an overall total that is well below the 75 percent “stay at home” threshold mandated for “high-quality” scrap in the new proclamation.

In a statement released Wednesday evening, the Washington-based Recycled Materials Association (ReMA) expressed gratitude that proposed scrap restrictions, though mentioned, have not been enacted.

“ReMA is grateful to President Trump and his administration for recognizing that the data and facts provided by our industry during the course of this investigation did not support the imposition of export restrictions on recycled copper, commonly known as copper scrap,” ReMA President Robin K. Wiener says.

“ReMA provided extensive data to the White House and the Department of Commerce demonstrating that the domestic copper recycling industry is strong and robust, and that export restrictions were not warranted given the current strength of the domestic industry. Accordingly, the White House agreed and declined to impose any restrictions on the copper industry’s ability to export.”

Regarding the potential 25 percent domestic sales mandate, Wiener says ReMA’s member companies have the ability year after year to meet the U.S. national defense supply requirements, including the sectors that indirectly support the defense industrial base.

“We look forward to working with the Commerce Department as it assesses any shortfalls in national defense needs and the most effective ways to address such shortfalls should they arise," she says.

*This item was updated July 31, 2025, to add comments from the Copper Development Association and the Recycled Materials Association.