Source: YI CAI

Author: Feng Dikan

The US also plans to impose new tariffs on pharmaceuticals, semiconductors, and several other specific industries.

With just one day left until the 9th, the Trump administration continues to roll out new tariff threats.

On the 8th local time, US President Trump stated that he would impose a 50% new tariff on all copper imported into the United States, but did not specify when the new tariff would take effect.

Trump also indicated that the US government intends to impose new tariffs on pharmaceuticals, semiconductors, and several other specific industries.

Meanwhile, Trump also posted on social media that he would announce trade measures related to at least seven countries on the morning of the 9th local time, with more countries to be announced in the afternoon.

On February 25, 2025, the Trump administration announced the initiation of a Section 232 investigation (hereinafter referred to as "Section 232 investigation") on US copper imports.

Jian GUAN, a partner at Beijing Grandwin Law Firm, told a China Business News reporter that in the future, compared to so-called "reciprocal tariffs," more attention should be paid to Section 301 investigations and the US's Section 232 investigations conducted in the name of national security. Greater vigilance is needed for these types of investigations, as they can not only cover products/industries but also extend to derivatives of such products. For example, "expanding the tariff scope from steel to refrigerators, washing machines, and other home appliance products."

"Raising Copper Tariffs to 50%"

On the 8th, Trump said during a cabinet meeting at the White House: "I think we're going to raise the tariff on copper to 50%."

According to Xinhua News citing CNBC, after the cabinet meeting, US Commerce Secretary Lutnick said the Department of Commerce had completed its investigation into the state of copper imports, and he expected the new tariffs "could be implemented around the end of July or August 1st."

Analysts at Citigroup also stated in a report that they expect officials to confirm the 50% rate within weeks and implement it within 30 days. "We believe this will be a turning point for the copper market in 2025," the report said.

According to FactSet data, New York copper futures prices surged 13% that day to $5.69 per pound, marking the largest increase since 1969. The shadow of the copper tariff hike triggered a rush for the metal's supply and price, as copper is widely used in electronics, construction, and industrial equipment.

Daniel Hynes, Senior Commodity Strategist at ANZ Bank, stated in a report that New York copper prices have risen to an "unprecedented" 25% premium over London Metal Exchange (LME) futures prices.

According to customs data compiled by Trade Data Monitor, Chile is the largest supplier of refined copper to the US, accounting for about 70% of imports by value, followed by Canada and Peru.

Navarro, President of Chile's Industrial Association, warned that a tariff as high as 50% could lead to a "significant deterioration" in the country's terms of trade. Pierre Gratton, President of the Mining Association of Canada, stated that the US lacks sufficient copper refining capacity and smelters and relies on imports from Canada, and such high tariff rates would "harm US manufacturing."

Lawyer: Vigilance Needed Regarding Section 232 Investigations and Expansion of Tariff Scope

As mentioned earlier, Trump also stated that the US government intends to impose new tariffs on pharmaceuticals, semiconductors, and several other specific industries, citing as an example the possibility of imposing new tariffs as high as 200% on foreign-made pharmaceuticals. However, he indicated that this new tariff might not take effect in the short term, aiming to give pharmaceutical companies time to relocate to the US.

Previously, on February 25, the US initiated a Section 232 investigation into copper imports, based on Section 232 of the Trade Expansion Act of 1962, which authorizes the US President to impose higher tariffs or other restrictive measures on imported goods on national security grounds.

In a document titled "Addressing the Threat to National Security from Imports of Copper," the White House stated that copper is a critical material necessary for US national security, economic strength, and industrial resilience, playing a vital role in defense applications, infrastructure, and emerging technologies including clean energy, electric vehicles, and advanced electronics.

The document argued, however, that US reliance on foreign sources for mined, refined, and smelted copper is increasing. While the US has ample copper reserves, its smelting and refining capacity is insufficient.

The document then directed the Secretary of Commerce to conduct an investigation under Section 232 of the Trade Expansion Act to determine the impact on national security of imports of copper in various forms, including copper ore, copper concentrates, refined copper, copper alloys, copper scrap, and derivative products.

Previously, MOFCOM Spokesperson He Yadong responded to this, stating that the US investigation is an act of unilateralism and protectionism implemented in the name of "national security."

He Yadong stated that a WTO panel ruled as early as 2022 that US Section 232 tariff measures violate WTO rules. However, the US has not only reinstated Section 232 tariffs on steel and aluminum recently but also persists in launching new Section 232 investigations, which will further undermine the rules-based multilateral trading system and disrupt the stability of global industrial and supply chains.

Jian GUAN told a China Business News reporter that since the current Trump administration took office, it has initiated multiple Section 232 investigations. The problematic aspect is that these Section 232 investigations target not only the products themselves but also impose Section 232 measures on derivative products. "There are many derivatives; take steel and aluminum product derivatives as an example. Major products can easily be encompassed."

For instance, on June 12, the US Department of Commerce announced it would impose tariffs on various steel household appliances starting June 23, including "steel derivative products" such as dishwashers, washing machines, and refrigerators.

According to a notice issued by the US Commerce Department's Bureau of Industry and Security (BIS), this tariff adjustment added 8 categories of household appliances and related products as "steel derivative products," uniformly applying a 50% tariff rate. The duty amount will be calculated based on the value of steel components contained in each type of product.

BIS added 8 categories of household appliances and related products as "steel derivative products," specifically including combination refrigerator/freezers; small and large clothes dryers; washing machines; dishwashers; upright and chest freezers; cooking ranges, stoves, and ovens; food waste disposers; and welded metal racks, among others.

BIS explained the tariff calculation method, which is assessed based on the value of steel content in each product. For example, if a dishwasher has a total value of $1,000, of which the steel components (such as the internal frame or casing) are valued at $200, the tariff to be levied would be 50% of $200, i.e., $100.

"This means taxing the steel cost embedded in such products," Jian GUAN said. Although the WTO previously ruled that US Section 232 tariff measures violate WTO rules, in court proceedings, matters like national security are indeed difficult to challenge.

The US has already announced high tariffs on automobiles and steel/aluminum products accordingly. However, according to statistics from a China Business News reporter, investigations into industries such as pharmaceuticals, copper, lumber, aerospace, chips, and consumer electronics are still ongoing.

Continuing to Send Letters on the 9th

The day before Trump proposed the copper tariff measures, he sent letters to 14 trading partners, stating that from August 1st, tariffs ranging from 25% to 40% would be imposed on imports from 14 countries including Japan and South Korea. However, the EU, as a key US trading partner, did not receive such a letter. Currently, Trump has hinted that he will continue sending more letters on the 9th.

On the 8th, Lutnick stated that 15 to 20 letters are expected to be sent over the next 2 days.

During Tuesday's cabinet meeting, Trump indicated that he plans to send a letter to the EU informing them of the tariff measures to be implemented starting August 1st. "We might send them a letter within two days," he said. "I just want you to know, a letter means an agreement."

Trump also commented that the EU is now "very friendly to us," but complained about the EU filing lawsuits and fines against US tech companies.

European Commission President Ursula von der Leyen stated on social media on Wednesday that the EU is "working closely" with the Trump administration and engaging in negotiations "in good faith" to reach an agreement.

Previously, EU Trade and Economic Security Commissioner Maroš Šefčovič, reporting to the EU on negotiation progress, stated that the EU expects to sign an interim trade agreement with the US this week, which would maintain the baseline 10% tariff level during ongoing negotiations while granting a certain degree of tariff exemptions for sensitive industries such as aircraft and spirits. Additionally, discussions are underway regarding reducing 25% automobile tariffs, but it is difficult to guarantee whether steel and aluminum tariffs can be reduced from the current 50% rate.