LME base metals dipped on Monday, with copper hitting its lowest level in more than three weeks, as U.S. President Donald Trump's 10% tariff on imports from China, the top metals consumer, fuelled trade war concerns and added uncertainty to the market.
Benchmark copper was down 1.05% at $8,953 a metric ton, as of 0126 GMT, hitting its lowest level since Jan. 6.
Trump on Saturday imposed 25% tariffs on Mexican and most Canadian imports and 10% on goods from China, starting on Tuesday. White House officials said there would be no exclusions from the tariffs.
He pledged to keep the duties in place until what he described as a national emergency over fentanyl, a deadly opioid, and illegal immigration to the U.S. ends.
China said it would challenge Trump's move at the World Trade Organization and take other countermeasures.
More tariffs are coming, Trump said, adding that import taxes were being considered on European goods, as well as on steel, aluminum and copper, and on drugs and semiconductors.
The dollar index rose 1.2% to its highest level in three weeks. A stronger dollar makes greenback-priced commodities more expensive for holders of other currencies.
Citi said in a note that they see further tariff escalation as bearish for copper to $8,500/t over the next three months, on an ex-U.S. price basis.
Three-month aluminium fell 1.4% to $2,558, easing to its lowest level in over two weeks.
LME zinc fell 1.2% to $2,708 a ton, lead shed 0.7% to $1,936.5, tin eased 0.9% to $29,845 and nickel lost 0.4% to $15,145.
The Shanghai Futures Exchange is closed for the Lunar New Year holiday. Markets will resume trade on Wednesday, Feb. 5. - Reuters
