Ole Hansen, head of commodity strategy at Saxo Bank, warns that the current accumulation of metal on U.S. soil is an anomaly that defies traditional market logic. While traders have aggressively shipped refined copper into the country to preempt potential 15% to 30% duties proposed by the Commerce Department, the anticipated outflow has failed to materialize. Even after previous tariff deadlines passed without action, the metal remained locked in American warehouses, particularly in New Orleans, where roughly 63% of cancelled tonnage is now concentrated.

This domestic buildup has decoupled the U.S. market from the rest of the world, where copper remains tight. While the London Metal Exchange is experiencing extreme backwardation—a signal that buyers are desperate for immediate supply—Hansen suggests this may be a localized squeeze rather than a reflection of global shortages. Mining giants like BHP are struggling to boost output as ore grades decline and development costs soar, leaving the industry focused on consolidation rather than the costly, multi-year process of expanding production. As long as the threat of tariffs persists, the U.S. stockpile remains a captive asset, keeping the rest of the global market in a state of precarious scarcity.