Copper, Tariffs and the New Race for Secure Resources

10/09/2026

America is seeking to reassert its dominance in a world it believes has taken its goodwill, and increasingly its security guarantees, markets and capital, for granted. Whether measured through defence spending, trade imbalances or industrial sharp practice, Washington is questioning arrangements it once regarded as the price of leadership.

That post-war architecture delivered the US an extraordinary privilege: the ability to finance itself cheaply and in its own currency. The catch is the debt accumulated along the way. Apply the Ferguson Rule, the point at which the cost of servicing government debt exceeds defence spending, and history offers an uncomfortable warning about the fiscal constraints that accompany imperial overstretch.

The Trump administration's answer is leverage over resource access, manufacturing capacity, inbound investment and, increasingly, the map of influence itself through what has been called the Donroe Doctrine. The rest of the world is recalibrating in response, and investors are beginning to reconsider what a hard asset is worth in an environment where access can no longer be taken for granted.

Manufacturing, refining and processing all ultimately require physical resources. Many are already scarce, while others risk becoming so as countries compete to secure supply chains. All require power, whose cost and strategic importance are rising alongside them.

Inflation is the visible risk, but the more consequential effect may be the higher interest rates required to contain it.

Meanwhile, wars are breaking out across the globe. Even where access to resources is not the original cause, resources, infrastructure and trade routes invariably become points of leverage as conflicts escalate.

China has, in some respects, been a beneficiary of this upheaval. Washington is attempting to resolve long-run strategic problems on a short-term political schedule, while Beijing continues to build insulation against the system America dominates. One manifestation is the steady repositioning of Hong Kong as a financial centre capable of operating with less dependence on the US dollar system, part of China's broader insurance against the possibility of one day being shut out of it.

Copper provides an interesting proxy for this contest.

The outlook for the global refined market has repeatedly swung between surplus and deficit, complicated further by uncertainty over Section 232. The prospect of US tariffs has already pulled well over half a million tonnes of metal into American warehouses, distorting the geographical distribution of inventory ahead of a final tariff decision.

The near-term supply picture is therefore genuinely contested, while the longer-term demand outlook is more consistent. Traders can look at today's inventories, warehouse flows and forward curves and see ample metal. Strategic investors looking further out see electrification, grid expansion, defence, data centres and the enormous difficulty of bringing new mines into production. Increasingly, they are responding not simply by buying the derivative, but also moving further up the supply chain and buying access to the resource itself.

The question is shifting from what is copper worth? to what is secure access to copper worth?

The US administration is, of course, cognisant of the distortions created by tariff uncertainty and presumably not displeased that one consequence has been a rapidly growing domestic inventory.

That becomes particularly interesting as we approach November, when China will decide whether to continue supplying strategic materials previously exempted from its export controls.

The warehouse may be full today, but the policy question is what it will cost to refill tomorrow.

Important Disclaimer

This article is intended for general information purposes only and reflects the market environment at the time of writing. It does not constitute investment advice, a personal recommendation, or an offer to engage in any trading activity. The content does not take into account individual objectives or circumstances and should not be relied upon as the basis for any investment decision. Past performance is not a reliable indicator of future results. 

Content may have been created by persons who have, have previously had, or may in the future have personal interests in securities or other financial products referred to therein. All conflicts and potential conflicts relating to our business are managed in accordance with our conflicts of interest policy. For more information, please refer to our Summary of Conflicts of Interest Policy. 

For more information and important risk disclosures, please see our Derivative Product Trading Notes and Privacy Policy. AMT Futures Limited is authorised and regulated by the Financial Conduct Authority.