As the United States reevaluates its dependence on foreign critical minerals, copper is emerging as more than just an industrial workhorse. It's increasingly seen as a strategic asset—essential to defense, energy infrastructure, and the clean energy transition. Now, with growing discussions around applying Section 232 of the Trade Expansion Act to copper, markets are beginning to consider the implications. If tariffs or import restrictions were enacted under Section 232, the impact on copper prices, supply chains, and global trade could be profound.

Section 232 gives the U.S. President the authority to restrict imports deemed a threat to national security. This power has previously been used to impose tariffs on steel and aluminum. The logic? A nation that can't produce enough of its own critical materials is strategically vulnerable. In today’s geopolitical climate—where copper plays a central role in everything from electric vehicles to missile systems—that argument is being revived.

There are several reasons copper might come under the 232 microscope. First, its national security relevance is growing. Copper is a foundational input for power grids, EVs, semiconductors, and military electronics. Yet the U.S. relies heavily on imports, particularly from countries like Chile, Peru, and China—introducing potential chokepoints. Second, supply and demand dynamics are tightening. As the global energy transition accelerates, demand for copper is surging, but new supply remains constrained. The risk of being caught off guard by a geopolitical event or supply disruption is real.

There's also precedent. The steel and aluminum tariffs were imposed under similar logic—to rebuild domestic supply chains, reduce dependence on foreign adversaries, and revive strategic industries. Copper could be the next domino.

If Section 232 is applied to copper, the immediate effect would likely be a price spike. Domestic producers might benefit, but manufacturers—especially in sectors like construction, consumer electronics, and renewables—could face significant cost pressures. Supply chains would feel the squeeze. Companies that depend on imported copper cathodes or concentrates might need to scramble for alternative suppliers or face delays and cost inflation. There’s also the risk of retaliation from key trading partners, like Chile and Mexico, which could trigger broader trade tensions and complicate international cooperation.

However, the longer-term effects may be mixed. On one hand, tariffs could incentivize new investment in U.S. copper mining—particularly in regions like Arizona, Utah, and Montana. On the other hand, the reality of permitting delays, environmental hurdles, and political pushback could limit how much new supply actually comes online.

In this environment, hedging becomes critical. Companies exposed to copper—whether as buyers or sellers—must protect themselves against price swings and policy shocks. Political risk is now market risk.

That’s where Pillar comes in. Our platform helps businesses automatically identify their exposure to physical copper transactions, design optimal hedging strategies using financial instruments, and execute trades in real time. Instead of reacting to volatility, firms using Pillar are prepared for it. Whether Section 232 goes through or not, the message is clear: the era of predictable input prices is over. Strategic risk management is no longer optional.