Copper Prices Face Further Downside as U.S. Tariff Expectations Weaken: TD Securities
TD Securities sees further downside risk for copper as U.S. tariff expectations weaken and uncertainty grows over future AI data-centre demand. A slowdown in American copper stockpiling could add pressure, although constrained mine supply may limit losses.
Key Points
- Copper prices retreat: Three-month LME copper traded near $13,779 per tonne on November 6, its lowest level since July.
- TD Securities warns of further losses: Bart Melek sees room for another $500-per-tonne decline as U.S. tariff and stockpiling incentives weaken.
- Supply constraints remain: BMI cut its 2026 copper mine production growth forecast to 1.1% from 2.4%, potentially limiting downside pressure.
SEATTLE (Scrap Monster): Copper prices could face further declines as changing U.S. political conditions weaken expectations for future import tariffs and raise questions about anticipated demand from artificial intelligence infrastructure, according to TD Securities.
Three-month copper futures on the London Metal Exchange (LME) traded near US$13,779 per metric tonne on Friday, November 6, marking their lowest level since July.
The metal has retreated from its September peak of nearly $6.80 per pound as investors reassess the outlook for tariffs, industrial demand and global copper inventories.
SCRAPMONSTER EDGE | COPPER MARKET ANALYSIS
The Bigger Risk May Be Slower Stockpiling, Not Falling Copper Consumption
U.S. tariff expectations have encouraged copper shipments into American inventories, providing an additional source of demand beyond immediate industrial consumption.
TD Securities estimates that approximately 1.6 million tonnes of copper have accumulated in the United States. If tariff incentives weaken and price differences between U.S. and overseas markets narrow, additional stockpiling may become less attractive.
Based on the approximately $13,843-per-tonne Thursday market reference cited in the analyst coverage, another $500 decline would represent a potential drop of about 3.6%. This is an analyst scenario, not a confirmed future price.
Industry takeaway: Copper recyclers, processors and traders should distinguish physical manufacturing demand from inventory accumulation driven by trade policy. A change in stockpiling incentives could influence refined copper benchmarks and scrap buying conditions even before industrial consumption materially changes.
TD Securities Sees Another $500/Tonne Downside Risk
Bart Melek, managing director and global head of commodity strategy at TD Securities, expects copper prices could weaken by another $500 per tonne.
The assessment follows Democratic gains in the U.S. midterm elections, which have increased uncertainty around proposed copper import tariffs and future investment in energy-intensive AI data centres.
However, the election outcome does not itself change existing tariff rules. Any changes to copper import duties would require subsequent government action.
Uncertainty over data-centre development could also affect expectations for copper consumption in electrical infrastructure, power distribution and cooling systems. The scale and timing of any resulting demand change remain uncertain.
U.S. Copper Stockpiling Could Lose Momentum
According to TD Securities estimates, the United States has accumulated approximately 1.6 million tonnes of copper inventories.
Anticipation of potential tariffs on refined copper has encouraged traders and buyers to move material into U.S. warehouses, helping support demand and creating differences between domestic and international copper prices.
Those incentives could weaken if import tariffs become less likely or the price advantage associated with holding copper in the United States diminishes.
A slowdown in stockpiling would remove one source of market support, although it would not necessarily indicate an equivalent reduction in copper demand from manufacturers.
BMI Cuts Copper Mine Supply Growth Forecast
Supply-side constraints could prevent a deeper correction, according to BMI, Fitch Group's research unit.
BMI lowered its forecast for 2026 global copper mine production growth to 1.1%, down from its previous estimate of 2.4%, reflecting ongoing production challenges.
The research firm expects average copper prices of approximately $13,500 per tonne in 2026 and $12,900 per tonne in 2027.
These annual averages are distinct from TD Securities' shorter-term downside scenario. Mine disruptions, constrained supply growth and demand from electrification could provide some support even if tariff-related stockpiling slows.
Market data and reporting: LME copper figures refer to November 6, 2026. TD Securities' price and inventory assessments and BMI's mine-production and price forecasts are analyst estimates, not guaranteed outcomes. Historical exchange reference: Westmetall LME Copper Market Data.