China-U.S. Trade Tensions Resurface: Uncertainty Looms Over Secondary Copper Raw Material Imports [SMM Analysis]

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       Tracing back to 2018, during the US-China trade dispute, imports of secondary copper raw material from the US were affected and subjected to a 25% tariff hike. However, the reduction in import volume of secondary copper raw material at that time was not directly caused by the tariff adjustment but rather due to the strict restrictions on the import of "Category 7" copper scrap. These restrictions once led to a tight supply of secondary copper raw material in the domestic market.

       However, with the lifting of relevant permit restrictions in 2020, secondary copper raw material was allowed to be freely traded as a commodity, resulting in four consecutive years of positive growth in import volume. Additionally, on February 18, 2020, the Customs Tariff Commission of the State Council issued an announcement on the market-based exclusion of US goods subject to additional tariffs. It explicitly stated that imported goods purchased from the US under market-oriented and commercial principles would not be subject to additional retaliatory tariffs for a certain period. Secondary copper raw material (HS code: 74040000) was included in this application scope, meaning that importers could exempt the previously imposed 25% retaliatory tariff by submitting the relevant application.

       However, in mid-to-late November 2024, news emerged that the newly elected US President Trump planned to impose a 10% tariff on Chinese products entering the US. This sparked concerns among most domestic import traders, who feared that the US-China trade dispute might once again affect the import of secondary copper raw material. As a result, they began gradually halting direct imports of secondary copper raw material from the US.

       Now, the tariff policy has been initially implemented. On February 1, 2025, US President Trump signed an executive order to impose an additional 10% tariff on Chinese goods on top of the existing tariffs. In response, the Customs Tariff Commission of China's State Council promptly issued an announcement on imposing tariffs on certain imported goods originating from the US. However, secondary copper raw material (HS code: 74040000) was not included in this round of tariff hikes. Details are as follows:

       Nevertheless, according to SMM, most traders stated that although they have resumed normal imports of secondary copper raw material from the US, they remain concerned about the uncertainty of tariff policies. Currently, there are no results from the talks between Trump and China. To mitigate potential risks, they have been quoting prices slightly lower than before to prepare for both scenarios. Meanwhile, a small number of traders indicated that they would continue to observe for a few days and make decisions after the policies are fully implemented.

       In summary, this initial confrontation over tariffs between the US and China has once again triggered market concerns about tariffs and the future of US-China trade disputes. With the continued escalation of US-China trade frictions, an increasing number of export enterprises are choosing to establish factories overseas to mitigate risks. This trend may lead to an overall decline in traditional manufacturing industries and force some foreign trade enterprises to face the risk of being eliminated or voluntarily exiting the market.