Investing.com -- Shares of Freeport-McMoran (NYSE: FCX) climbed 6% following President Donald Trump's announcement of a new commerce probe that could lead to tariffs on copper imports. This action is seen as a potential boon for domestic copper producers like Freeport-McMoran, as it may increase demand for locally sourced copper.

The investigation, ordered under Section 232 of the Trade Expansion Act of 1962, is the same legal mechanism used by Trump to impose tariffs on steel and aluminum. The White House believes that imposing tariffs on copper could rebuild U.S. production of the metal, which is crucial for various industries including electric vehicles, military hardware, semiconductors, and consumer goods.

Commerce Secretary Howard Lutnick stated that the U.S. copper industry has suffered due to global competition and that the probe into possible tariffs is a step towards revitalizing domestic production. Lutnick emphasized the importance of copper to U.S. industries and national defense, advocating for its production to be entirely based in America.

The White House official highlighted concerns over China's attempts to dominate the global copper market through state subsidies and economic influence. The probe will also explore the impact of imports of raw mined copper, copper concentrates, copper alloy, scrap copper, and derivative products on national security.

The announcement comes as part of President Trump's broader strategy to protect the U.S. economy with tariffs and to revive the manufacturing sector. The administration is also proceeding with separate 25% tariffs on imports from Mexico and Canada, set to take effect on March 4, despite ongoing negotiations.

The markets have responded positively to the news, as Freeport-McMoran's stock surge reflects investor optimism about the potential benefits of new tariffs for the U.S. copper industry. However, no specific tariff rates have been determined yet, as they will be decided upon the conclusion of the investigation.

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