Hong Kong-listed copper producers sold off hard on Sept. 11 after Reuters reported the White House has not decided whether to impose tariffs on refined copper imports, unwinding the premium that had driven prices to records. Jiangxi Copper fell 10.65% and CMOC 10.04%, with short-selling ratios across the group running between 12% and 28%.
Hong Kong's non-ferrous metal complex bore the brunt of a broad risk-off session on Sept. 11, with Jiangxi Copper (江西銅業, 0358.HK) tumbling 10.65% to HK$34.40 and CMOC Group (洛陽鉬業, 3993.HK) shedding 10.04% to HK$15.60 after Reuters reported the White House has yet to decide whether to impose tariffs on refined copper imports.
The retreat erased the speculative premium that had built through the summer on expectations of imminent U.S. duties. "The market priced a tariff that has not been written yet, and now it is paying for that assumption," said Kevin Ip, a Hong Kong equities strategist who spent seven years at Hong Kong Exchanges and Clearing. "Until the White House signs something, every rally in these smelters is a bet on a headline rather than on cash flow."
The selling was concentrated in the purest tariff-exposed names. Zijin Mining (紫金礦業, 2899.HK) fell 7.55% to HK$34.52, MMG (五礦資源, 1208.HK) dropped 9.46% to HK$8.95, and China Nonferrous Mining (中色礦業, 1258.HK) lost 7.00% to HK$16.07. Short-selling turnover ran heavy across the group: HK$314.70 million in Zijin at a 17.10% ratio, HK$157.55 million in CMOC at 16.22%, HK$128.62 million in MMG at 27.79%, and HK$99.34 million in Jiangxi Copper at 12.47%, according to exchange data as of 12:25 HKT.
The catalyst was a Reuters report, citing two people familiar with the matter, that the White House has not reached a final decision on refined copper tariffs. A White House official confirmed the Commerce Department submitted an updated copper market assessment to President Donald Trump before the administration's June 30 deadline, and said all options remain under evaluation. Trump had previously asked Commerce Secretary Howard Lutnick to recommend whether to levy a 15% duty on refined copper from 2027, rising to 30% in 2028. The U.S. already applies a 50% tariff on certain semi-finished copper products such as pipe and wire, effective Aug. 1, 2025, with refined metal carved out.
The policy ambiguity cuts both ways for the administration. Tariffs would support domestic mining, smelting and refining projects, but they also raise input costs for U.S. manufacturers already absorbing elevated metal prices. That tension is why the decision has slipped past the deadline without resolution.
The equity damage maps directly onto the copper price. COMEX October copper futures fell more than 4% intraday to about $6.585 per pound on Sept. 10, and Freeport-McMoRan (FCX) dropped more than 8% in U.S. pre-market trading. The tariff expectation had pulled metal into the United States at a record pace: July imports of refined copper and copper alloys reached 225,094 metric tons, the highest single-month total since 1990. COMEX inventories stood near 694,000 metric tons in early September, roughly 70% of combined visible stocks across the LME, COMEX and SHFE, while SHFE stocks held near 63,000 metric tons, a low since January 2024.
For Chinese smelters, the transmission is less about the copper price than about treatment and refining charges. Jiangxi Copper and CMOC earn processing fees on concentrate, and a tariff-driven U.S. premium does not lift those fees — it distorts regional spreads instead. If Washington declines to tax refined copper, some metal that flowed into U.S. warehouses could reverse into Asian markets, pressuring the regional premium that has flattered smelter margins.
The cross-asset backdrop offered no relief. The Shanghai Composite slipped 0.4% and the CSI 300 lost 0.5%, while the offshore yuan traded at 7.1285 per dollar, weaker by 0.2%. China's 10-year government bond yield held at 1.82%, and the U.S. 10-year Treasury yield sat at 4.31%, up 3 basis points overnight — a combination that keeps pressure on cyclical Hong Kong names funded in dollars.
Positioning is the wildcard. Short-selling ratios of 12% to 28% across the group mean the bearish case is already crowded. Any signal that the White House intends to proceed with duties would force covering, and the same leverage that amplified the Sept. 11 decline would work in reverse. The next hard datapoint is the administration's formal decision on the Commerce recommendation, which has no published deadline after the June 30 submission.
This article is for informational purposes only and does not constitute investment advice.
