According to Zhihu Finance APP, the prices of Copper and Silver Futures in New York have soared above the international benchmark prices, as traders increased their bets that USA President-elect Donald Trump would impose high import tariffs on these two metals as part of the escalation of the Global trade war.

On Thursday, the near-term Silver Futures price on the New York Exchange (COMEX) was more than $0.90 per ounce above the spot price in London, nearing last December's high, as traders reacted to Trump's promise of imposing general tariffs on all goods from all countries.

The premium of Silver in New York has jumped again.

Ahead of Trump's inauguration on January 20, anxiety over Trump's trade policies has intensified in the financial markets. Media reports suggest that Trump's team is planning to reduce import tariffs on key commodities, possibly including Copper, but Trump has denied this claim. On Wednesday, media cited informed sources saying that Trump is considering declaring a national economic emergency to provide a legal basis for comprehensive tariffs.

Ole Hansen, head of commodity strategy at Saxo Banks, stated: "At the beginning of this year, investors around the world are seeking protection against tricky and possibly rising inflation, concerns about fiscal debt, and Trump's unpredictability." The surge in futures prices in New York is "absolutely part of the unpredictability story of Trump."

The near-term Copper Futures price on COMEX is also $623 per ton higher than similar futures on the London Metal Exchange, approaching historic levels during last year's unprecedented short squeeze. Since last year, traders have been shipping Copper to USA warehouses to profit from soaring prices. Since New York Silver prices started surging, traders have been taking similar actions.

New York Copper prices have a huge premium over similar futures in London.

While the price distortion presents huge opportunities for traders holding Metal, it also poses significant risks for investors who do not hold Metal.

Prices in the New York and London Metal markets usually trade almost in sync, with many algorithmic traders and hedge funds trying to profit by betting that the spread will soon narrow again.

In terms of Copper, this could involve buying London Copper contracts while simultaneously selling New York Futures, and typically these so-called arbitrage trades would quickly bring prices back to normal levels. If the spread continues to widen, investors may face massive losses.

This dynamic was a key factor behind last year's Copper market short squeeze, when arbitrage traders bet that New York Futures prices would decline relative to London Futures prices, resulting in mounting losses. Now, some traders and Analysts indicate that a short squeeze may be replayed in the Silver market, as the deliverable quantity of Silver on the COMEX is limited.

Daniel Ghali, a senior Commodity strategist at TD Securities, stated, "The market is currently caught in a dazed squeeze. People are completely ignoring this risk."

Dealers are rushing to transport Copper and Silver to New York.

In the Silver market, major dealers can transport metals from London to New York warehouses to close arbitrage trades. Over the past five weeks, the Silver inventory at the New York Commodity Exchange has increased by 15 million ounces of Silver. Typically, Silver is transported via Ships, with delivery time usually between 30 to 45 days.

However, Ghali stated that after four consecutive years of severe shortages in Global Silver mining production, the inventory in the London market has been severely depleted, and further outflows could lead to a spike in prices.

He stated, "We anticipate that the scale of the outflow will be very large, this is the 'Silver squeeze period' during which you can Buy."