If Trump Tariffs Imported Silver Will US Silver Miners Receive A Premium For Their US Mine Silver Production?
Lots has been written about recent accelerated imports of silver to NY COMEX vaults and how that is being driven by CME COMEX traders acquiring physical silver allegedly to avoid having to pay Trump’s coming tariffs on imported silver.
Question: If Trump does apply tariffs on imported silver does that mean that US silver miners will receive a market premium on US mined silver, above the London price but below the tariff rate?
If US silver miners receive such a premium on their silver production, do you think that will drive premium net profits for these miners?
Please leave comment below in the comment section.
Best regards,
David Jensen
I doubt if that will happen since “everything is negotiable”. If it does, I don’t see why domestic silver producers would not get a higher price. We import three times as much as we export, so domestic silver would stay in the U.S. at the imported tariff price. Why would they sell it for less as an export?
I am sure that Trump thinks this would spur further investment in Silver mining. Possibly to a degree, but as these tariffs could go away in four years, I doubt any long range mining projects are going to depend on this artificial construct.
Kevin Muir has written about tariffs in general and Hedgeye has too. Not specific to silver, but in a wider context, the market is NOT positioned for wide ranging, long term tariffs. The consensus is that this is 'just Trump's negotiating style'. However, these analysts have shown how Trump favours tariffs via public statements (going back decades). As per presentations prior to the Election, Trump sees tariffs as both a way to boost US jobs via onshoring and provide material revenue for the Federal Government. The state of the US Government debt / deficits is at a point where Trump must show a narrowing of the deficit, otherwise face a bond meltdown. DOGE will struggle to do all the heavy lifting and Trump will not raise taxes. Within this framework, tariffs make sense to him / his Administration. Your analysis about silver may be a clue to what the general market is missing. Specific to silver, if the above is correct, I see no reason why Silver would be exempt. Cheers John.