South America was the focus of Trump’s trade attack and while Chile is worried about its all-important copper industry and the threat of a 50% tariff, Brazil was warned that it would pay the same penalty for prosecuting former president Jair Bolsonaro.

It’s the mixing by Trump of commercial and political targets which is unnerving investors and explains why gold, which had been on a downward trend since mid-June, bounced back to US$3321 an ounce thanks to its safe-haven appeal.

Exactly how Trump proposes to enforce the 50% copper tariff is uncertain, but it seems likely that the real target is China and its vast copper refining industry.

There are also doubts about whether this week’s 15% copper price rise in the U.S. to an all-rime high of US$5.67 a pound will last long with Citi, an investment bank, telling clients yesterday that it expected a pull back to US$4.40/lb in the next three months, roughly this week’s price on the London Metal Exchange.

The different prices in London and New York have created fertile ground for arbitrage traders who can buy copper in one market and sell it in another, generating an instant 30% profit.

How that plays out over time is one of the Trump-caused uncertainties, but a likely outcome is that a shortage of copper will develop in Europe with the price there eventually being forced up while U.S. copper buyers complain loudly about the unfair costs being forced on them by their own President.

Copper miners had a roller-coaster week with Sandfire a useful proxy for the confusion, starting at $11.50, rising to a high of $11.63 before falling back to $10.96 and then restarting a climb to last trade at $11.05.

Other copper stocks travelled on a similar rocky road. Carnaby Resources got an initial 5c uplift to 45c after reporting encouraging drill results from its Trekelano project in Queensland before slipping back to 43c.

AIC Mines rose by 3c to 33.5c after reporting a seven metre intersection of 2.4% copper at its Jericho project near the Eloise mine in Queensland, only to retreat to 32c.

Top copper producers BHP and Rio Tinto fell sharply when the 50% copper tariff threat was lobbed into the market, recovered slightly but ended the week down. BHP slipped 59c to $38.04 and Rio Tinto was 50c weaker at $108.46.

The big boys of mining will file their June quarter reports next week (Rio Tinto on July 16 and BHP on July 18) and while copper production will be closely watched, most interest will be on their iron ore operations, which are travelling comfortably at this week’s price of US$95 a tonne.

Fortescue Metals, the leading pure-play iron ore stock, continued its recovery from a low of $14.54 three weeks ago to creep 15c higher this week to trade around $16.42, almost certainly with the support of investors chasing a fat dividend next month.

Mineral Resources, the controversial iron ore and lithium miner, also moved higher with a rise of 30c to $24.31 as investors shrugged off the negative publicity associated with ongoing corporate issues.

Gold clawed back recently lost ground, closing yesterday at around US$3321/oz, up US$37/oz on the midweek low of US$3284/oz.

The drift lower by gold came as the industry lobby group the World Gold Council reported strong first half exchange-traded fund inflow of US$38 billion, the best six months since 2020.

RBC Capital Markets said it maintained a strongly positive view of gold thanks to “geopolitical angst”, a way of saying investors are confused Trump’s antics. Central banks are equally uncertain and while they might not buy another 1000 tonnes this year, RBC expects purchases by the official sector of a still-substantial 876 tonnes.

The Canadian bank is tipping a September quarter price weakening to around US$3101/oz before a bounce back to end the year at an all-time high of US$3496/oz.

Most gold stocks lost ground this week as Trump’s tariff policies bruised investor confidence, with some of the more interesting moves and news including:

  • Northern Star, down $1.98 to $16.52 after surprising the market with weaker than expected production and profit guidance and higher costs. RBC sees a share price recovery to $22. Morgans has a target of $21.78, and Macquarie is sticking with $27.
  • Regis Resources said it had ended the financial year with $517 million in cash and bullion but was still marked down by 10c to $4.47.
  • West African Resources was 2c weaker at $2.33 after releasing a solid production result of 45,611oz in the June quarter.
  • Ramelius slipped 6c lower to $2.38 despite strong quarterly production and a buy tip from Macquarie which sees the stock rising to $3.10.
  • Bellevue Gold was 1c weaker at 93c even though it reported record free cash flow of $67 million. Macquarie has a $1.30 target price, and
  • Alkane was 2c weaker at 68c despite its Tomingley mine in NSW hitting production guidance at 19,193oz in the June quarter.

Lithium stocks had a better week after months of decline, buoyed by signs of a modest increase in Chinese demand for the battery metal.

Low profile Chariot Corporation performed best among the thinning ranks of lithium stocks, rising by 1.2c (18.5%) to 7.7c after announcing an investment in a Nigerian lithium asset.

Liontown rose by 3c to 76c ahead of the official opening of its Kathleen Valley project in WA while Pilbara Minerals went the other way with a fall of 3.3c to $1.49.

Despite the mixed outlook, miners and explorers continue to attract fresh capital which is a positive pointer. The latest crop of cash injections included:

  • Antipa, $40 million for work on its Minyari gold and copper project in WA.
  • Ausgold, $35 million to accelerate work on its Katanning gold project also in WA.
  • Native Mineral Resources, $10 million for its Blackjack gold project in north Queensland.
  • Mithril, $10 million for its Copalquin gold and silver project in Mexico, and
  • Arizona Lithium, $8 million. Manuka Resources $8 million, EQ Resources $4 million, and Zenith Minerals $3.5 million.

The rare earth sector had one reasonable winner in Viridis Mining which rose by 7c to 54c after announcing encouraging preliminary feasibility results for its Colossus project in Brazil.

Most other rare earth moves were down, including Lynas, which slipped 5c lower to $8.31 and Hastings, which was 1c weaker at 28c.

Other news and price moves of interest included:

  • DY6 Metals rose by 15c (90%) to 31c after reporting a significant expansion in its Central Rutile project in Cameroon.
  • New World Resources edged up by 0.2c to reach 6.6c thanks to a revised takeover offer of 6.2c from Central Asia Metals.
  • Aurelia Metals which is shifting its focus from gold to copper added 1c to 20c but could go as high as 50c according to Shaw and Partners.
  • Galileo Mining rose by 2c to 16c after announcing the start of an exploratory drilling program targeting platinum and palladium at its Norseman project in WA, and
  • Black Canyon rose by 3c to 19c after reporting that drilling had confirmed a manganese iron discovery at its Wandanya project in WA.