Dmitry Kuznetsov: electronics and construction sectors will suffer from duties on the US copper imports

Dmitry Kuznetsov, a researcher at the Gaidar Institute’s International Trade Department, named to RIA Novosti the industries that would be hardest hit by possible duties on US copper imports.

«Around half of the copper consumed by the U.S. is imported. In this context, the imposition of duties on such a fairly homogeneous commodity will be to a large degree transferred into the price on the U.S. domestic market. The most important sectors of the economy will be affected: electronics production, construction, transportation engineering," commented the expert on the consequences of tariffs imposition for the States.

It is impossible to replace copper with other metals in most cases, so consumption is unlikely to decrease significantly, but the cost of end products will certainly increase, emphasized Dmitry Kuznetsov.

According to the expert, the global copper market can be viewed fairly balanced, but the ever-growing demand for the metal in renewable energy and electric transportation, as well as production problems of the largest copper producer in Chile can put additional upward pressure on prices. «If prices do rise, it will create an additional margin of safety for producers, but will additionally hit U.S. copper consumers," he said.

Currently, the copper prices and production costs are at rather comfortable levels for producers, so they have some underlying strength and will not provide discounts on such a homogeneous commodity that can be easily diverted to other consumers. “Therefore, we can expect that producers will not provide significant discounts when exporting to the U.S., and the duty will be paid in the end by the U.S. consumers,” the analyst concluded.

Image by Alexander Kondratyuk / RIA Novosti

Friday, 28.02.2025