Expectations are set for 15 to 20 more tariff letters to be released soon. These letters will likely continue, especially with a focus on implementing a copper tariff by late July or early August. The tariff rates in these letters can vary. Some countries might get different rates if they show good relations with the U.S. There were reportedly many offers regarding these tariffs in Trump’s office as of Monday. The article suggests a clear move to expand trade measures, especially targeting copper but possibly going beyond that. Up to 20 additional announcements are expected. Each new letter could provoke significant market reactions, as pricing and cross-border dynamics change. What stands out is that tariff rates are conditional. There is no single rate for all countries. Instead, some nations may receive better terms if they maintain good diplomatic ties. This indicates that policy is being influenced not just by economic factors but also by broader strategic and political considerations. The fact that these documents were actively processed in the former President’s office, with many offers available as early as Monday, shows prior planning. We can expect this strategy to continue, paying attention to targeted sectors and how exceptions are framed. The reference to copper isn’t random; it highlights sectors of interest, as copper is vital for industrial activities and clean energy projects. Given this context, we can link messaging to market movements. We believe there will be a need to reevaluate forward volatility, especially regarding base metals and semi-finished goods. Traders with exposure to industrials or margin risks related to LME or COMEX products may want to reassess their positions closely. Emerging economies relying heavily on raw material exports will eventually react, and we’re already seeing shifts in risk spreads. Last month, Cohen suggested that supply chain compression now seems less temporary than expected. There’s already an increase in options activity on related contracts, particularly those extending into late Q3, indicating positioning around hedge and gamma strategies. If this trend continues, costs could start to rise before demand actually changes. Timing is critical. With July and August specified, this shortens the preparation time and coincides with traditionally slow trading periods. Liquidity may be thinner than models suggest, especially in secondary markets, affecting derivatives pricing and spot markets. Now is a good time to reevaluate current delta exposures and consider scenarios that could yield asymmetric returns with a changing tariff model. Hedging strategies related to bilateral tariffs, especially conditional ones, might be better adjusted now rather than after the announcements. We should closely monitor the curve distortion between front-month and deferred futures, as well as open interest related to those gaps. When policy directly impacts market structure, even passive traders may develop unintended biases. The data clearly reflects this. We’re also keeping an eye on sectors that have been quiet. Not because they are exempt, but because they could be next in line. Economic data may lag, but position data does not in this environment.

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