Stock of the day: Sandfire Resources

(AI video summary)

This video was created on 9 July 2025 for IG audiences by ausbiz.

ASX code: SFR

Impact of US tariffs on copper exporters

Exporters to the United States (US) will face a 50% levy on copper starting 1 August, as announced by President Donald Trump. This caused copper futures in New York to surge by up to 17%. Sandfire Resources, despite recovering slightly, remains down nearly 4.5%.

Operating in Australia, Africa, and Europe, with exploratory projects in the US, Sandfire Resources is dealing with a legal issue at its Black Butte mine in Montana. The US tariff prompts investors to consider whether this is a buying opportunity amid rising global copper demand.

The future of the copper market

As the copper market navigates new tariffs, Sandfire Resources and the sector face both risks and opportunities.

Analysts recognise copper's long-term potential, essential for the energy transition and infrastructure. They see potential opportunities for US-based producers amid tariff uncertainties but advise patience. While some view Sandfire as a 'buy' if conditions stabilise, others suggest holding due to existing uncertainties.

Investment outlook

Analysts suggest exercising caution, recommending exposure through exchange-traded funds (ETFs) instead of buying Sandfire. There is a preference for wider exposure through options like the wire ETF, which includes US producers like Freeport-McMoRan and highlights Rio Tinto as a strategic choice given the tariffs.