Nestled among the Oquirrh Mountains in Utah is the deepest open-pit copper mine on Earth. The Bingham Canyon mine, once owned by the Guggenheims and now run by Rio Tinto, has been in operation since 1903. Even now about 275,000 tonnes of the red metal are dug from it every year, nearly a quarter of America’s annual production. Its rocks are sent down a five-mile conveyor belt to be crushed. The mineral is then separated out, smelted into liquid and refined into 99.99% pure copper plates. The vertically integrated mine is the last of its kind in America, which until the 1960s was the world’s biggest producer of copper.

Donald Trump hopes to return to those glory days. On July 8th the president indicated that America would soon slap a 50% tariff on imports of the metal, having opened an investigation into them in February. “The idea is to bring copper home,” Howard Lutnick, the commerce secretary, subsequently elaborated, noting that an official announcement could come as soon as the end of the month. Yet the levies are unlikely to stimulate much mining or processing in America, while the resulting surge in prices will undermine Mr Trump’s wider economic agenda.

America is the world’s second-biggest consumer of copper, after China, but produces just 5% of the global supply and processes only 3%. Around 45% of American demand is met by net imports, which primarily take the refined form of pipes, tubes and wires, rather than raw ore. Most of them end up in buildings, including the factories and data centres Mr Trump is eager for America to construct, and electronics, which he wants the country to make much more of.

The president’s pronouncement has already sent the price for future copper supplies in America soaring—and overseas prices plunging. The divergence between the two had been widening since earlier this year. Copper inventories at the London Metal Exchange have declined as imports into America have surged amid stockpiling. All this has resulted in “intense volatility and speculation”, note analysts at United Overseas Bank, a Singapore-based lender.

Higher prices in America suit miners with copper assets in the country just fine. The shares of Rio Tinto and Freeport-McMoRan, an American miner which accounts for 60% of domestic copper production, have risen. For the latter, a 50% duty could result in windfall profits of $1.6bn a year, reckons Deutsche Bank, another lender.

Higher prices, though, will not do much to boost domestic supply, at least not any time soon. Digging mines takes years, sometimes decades—and is around three times as expensive in America as it is abroad. Refining copper is no easier; smelters cost about $3bn and gobble up huge amounts of power. Bosses are loth to make such large capital investments on the basis of tariffs that could easily be withdrawn at a whim of the president.

There would be better ways for Mr Trump to stimulate production. “The main changes that need to happen are on the expediency of approvals,” and “support for projects...from communities and legislators”, says Iván Arriagada, chief executive of Antofagasta, a Chilean miner. The president could focus in particular on fast-tracking the huge but long-delayed Resolution Copper mine in Arizona, a joint venture between Rio Tinto and BHP, another mining giant. By one estimate, it could meet another quarter of America’s demand for the metal.

By turning instead to tariffs, Mr Trump will harm American businesses. Carmakers use over 20 kilograms of copper in each vehicle, and even more in electric ones. Data centres require at least 27 tonnes of the metal per megawatt of power, adding up to almost 3,000 tonnes for a large site. Nvidia’s popular NVL72 server rack links together 108 of the chipmaker’s cutting-edge processors with some two miles of copper wire. Significantly higher prices in America could deter businesses from building factories and data centres in the country. That would crush Mr Trump’s plan for economic greatness. ■

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