Addressing the Threat to National Security from Imports of Copper
This Presidential order directs the Secretary of Commerce to investigate the national security implications of US dependence on foreign copper imports.
The order cites concerns about vulnerabilities in the copper supply chain, particularly the dominance of a single foreign producer, and the critical role of copper in defense, infrastructure, and emerging technologies.
The investigation will assess the effects of copper imports on national security, considering factors like domestic production capacity, foreign competition effects, and the potential for foreign market manipulation.
The Secretary of Commerce is tasked with submitting a report including findings on national security threats and recommendations for mitigating those risks, including potential tariffs, export controls, and incentives for domestic production.
Arguments For
National Security: The order emphasizes the critical role of copper in defense, infrastructure, and emerging technologies, arguing that dependence on foreign sources poses a significant national security risk. Evidence cited includes the dominance of a single foreign producer in global copper smelting and refining.
Economic Stability: The document highlights the economic vulnerability created by reliance on foreign copper supplies, particularly given the potential for market manipulation and price instability. The intended benefit is to improve US economic stability by promoting a more resilient domestic copper supply chain.
Trade Expansion Act Authority: The action is justified under Section 232 of the Trade Expansion Act of 1962, which allows the President to take action to address national security threats from imports.
Domestic Job Creation: Increased domestic copper production, smelting, and refining could lead to significant job creation in the United States. This is implicitly supported through calls for increasing domestic capacity to reduce reliance on imports.
Technological Advancement: By securing the domestic copper supply chain, the country enhances the country's ability to support technological innovation in clean energy, electric vehicles and other strategic sectors.
Arguments Against
Economic Costs: Implementing tariffs or quotas on copper imports could raise prices for consumers and businesses reliant on copper, potentially impacting competitiveness in various sectors. This cost could outweigh the national security improvements.
Retaliation from Other Countries: Other nations might retaliate with tariffs or trade restrictions on US goods, triggering a trade war with negative consequences for the US economy.
Limited Impact on Foreign Dependence: Even if domestic production increases due to this action, the US might still remain heavily reliant on imports for certain types of copper and related products. A comprehensive and long-term strategy might be necessary.
Inhibition of Innovation: Increased copper prices due to protective measures mentioned in the order might stifle innovation by increasing the cost of products using copper, and the associated industries relying on it. This could slow down the production of sustainable technologies, such as electric vehicles and clean energy products.
Unintended Consequences: Government intervention in the copper market carries the risk of unforeseen negative consequences, including distortions in the market and inefficient resource allocation.
By the authority vested in me as President by the Constitution and the laws of the United States of America, including section 232 of the Trade Expansion Act of 1962, as amended (19 U.S.C. 1862) (Trade Expansion Act), it is hereby ordered:
This opening statement establishes the legal basis for the presidential action, citing the authority granted by the Constitution and the Trade Expansion Act of 1962 as the justification for the order.
Section 1. Policy. Copper is a critical material essential to the national security, economic strength, and industrial resilience of the United States. Copper, scrap copper, and copper’s derivative products play a vital role in defense applications, infrastructure, and emerging technologies, including clean energy, electric vehicles, and advanced electronics. The United States faces significant vulnerabilities in the copper supply chain, with increasing reliance on foreign sources for mined, smelted, and refined copper.
The United States has ample copper reserves, yet our smelting and refining capacity lags significantly behind global competitors. A single foreign producer dominates global copper smelting and refining, controlling over 50 percent of global smelting capacity and holding four of the top five largest refining facilities. This dominance, coupled with global overcapacity and a single producer’s control of world supply chains, poses a direct threat to United States national security and economic stability.
It is the policy of the United States to ensure a reliable, secure, and resilient domestic copper supply chain. The United States’ increasing dependence on foreign sources of copper, particularly from a concentrated number of supplier nations, along with the risk of foreign market manipulation, necessitate action under section 232 of the Trade Expansion Act to determine whether imports of copper, scrap copper, and copper’s derivative products threaten to impair national security.
This section outlines the policy rationale.
The President declares copper a critical material for national security and economic reasons, highlighting US vulnerability due to reliance on foreign sources and the dominance of a single foreign producer.
The statement establishes the goal of a secure domestic copper supply chain and indicates that action is needed under the Trade Expansion Act to investigate potential national security threats.
Sec. 2. Investigation Into the National Security Impact of Copper Imports. (a) The Secretary of Commerce shall initiate an investigation under section 232 of the Trade Expansion Act to determine the effects on national security of imports of copper in all forms, including but not limited to:
(i) raw mined copper;
(ii) copper concentrates;
(iii) refined copper;
(iv) copper alloys;
(v) scrap copper; and
(vi) derivative products.
(b) In conducting the investigation described in subsection (a) of this section, the Secretary of Commerce shall assess the factors set forth in 19 U.S.C. 1862(d), labeled “Domestic production for national defense; impact of foreign competition on economic welfare of domestic industries,” as well as other relevant factors, including:
(i) the current and projected demand for copper in United States defense, energy, and critical infrastructure sectors;
(ii) the extent to which domestic production, smelting, refining, and recycling can meet demand;
(iii) the role of foreign supply chains, particularly from major exporters, in meeting United States demand;
(iv) the concentration of United States copper imports from a small number of suppliers and the associated risks;
(v) the impact of foreign government subsidies, overcapacity, and predatory trade practices on United States industry competitiveness;
(vi) the economic impact of artificially suppressed copper prices due to dumping and state-sponsored overproduction;
(vii) the potential for export restrictions by foreign nations, including the ability of foreign nations to weaponize their control over refined copper supplies;
(viii) the feasibility of increasing domestic copper mining, smelting, and refining capacity to reduce import reliance; and
(ix) the impact of current trade policies on domestic copper production and whether additional measures, including tariffs or quotas, are necessary to protect national security.
This section mandates an investigation by the Secretary of Commerce into the national security implications of copper imports.
The investigation scope includes all forms of copper and will consider factors like domestic production capacity, foreign supply chains, government subsidies, and the potential for foreign governments to manipulate the market.
The investigation will assess whether the current trade policy is adequate, considering the need for measures such as tariffs or quotas.
Sec. 3. Required Actions. (a) The Secretary of Commerce shall consult with the Secretary of Defense, the Secretary of the Interior, the Secretary of Energy, and the heads of other relevant executive departments and agencies as determined by the Secretary of Commerce to evaluate the national security risks associated with copper import dependency.
(b) Within 270 days of the date of this order, the Secretary of Commerce shall submit a report to the President that includes:
(i) findings on whether United States dependence on copper imports threatens national security;
(ii) recommendations on actions to mitigate such threats, including potential tariffs, export controls, or incentives to increase domestic production; and
(iii) policy recommendations for strengthening the United States copper supply chain through strategic investments, permitting reforms, and enhanced recycling initiatives.
This section outlines the required actions.
The Secretary of Commerce must consult with other relevant agencies and submit a report to the President within 270 days.
The report must include findings on whether copper import dependence threatens national security, recommendations on how to mitigate such threats (including potential tariffs or export controls), and recommendations for bolstering the domestic copper supply chain, encompassing strategic investments, regulatory reforms, and enhanced recycling efforts.
Sec. 4. General Provisions. (a) Nothing in this order shall be construed to impair or otherwise affect:
(i) the authority granted by law to an executive department or agency, or the head thereof; or
(ii) the functions of the Director of the Office of Management and Budget relating to budgetary, administrative, or legislative proposals.
(b) This order shall be implemented consistent with applicable law and subject to the availability of appropriations.
(c) This order is not intended to, and does not, create any right or benefit, substantive or procedural, enforceable at law or in equity by any party against the United States, its departments, agencies, or entities, its officers, employees, or agents, or any other person.
This section contains general provisions.
It clarifies that the order does not affect the authority of other government entities, must be implemented according to existing laws and subject to available budgetary resources, and does not create any legal rights or benefits that can be enforced in court.