According to Diario Financiero, a Chilean business newspaper, the US midterm elections on November 3 and a possible decision in January on a 15% tariff on copper are the two milestones that could shape the trade negotiations between Chile and Washington.
The Chilean government is currently in talks with the Office of the United States Trade Representative (USTR), the agency that runs US trade policy. The goal is to reverse the 12.5% tariff the US imposed on Chilean products in July. Those negotiations have not yet reached an outcome.
The first date is the midterms, the election that renews the US Congress halfway through the presidential term. Polls suggest the Democratic Party could win a majority in both the House and the Senate.
Gabriela Landeros, senior manager of global trade at Deloitte, told the newspaper that such a result could change the political climate of the negotiations. It would matter most if concern grows over the effect of tariffs on prices and on costs for US industry.
But she cautioned that a different Congress is not enough. "Under Section 232, the decision still rests with the Executive," she said. Section 232 is the provision that allows the president to impose tariffs on national security grounds. According to Landeros, limiting those powers would require passing a law, and the tariffs would not disappear automatically.
For that reason, she advised Chile not to bet its strategy on an election result and to keep showing that what it offers matters for US competitiveness and supply.
Matías Pinto, partner at Geogig Consulting, was more categorical. In his view, the election will change nothing in the negotiations with Chile, because "it is purely a matter for the Executive." He did acknowledge that, in the long term, the relationship with Congress is relevant for countries with free trade agreements.
The second date is January. Through the Section 232 investigation, the Department of Commerce may recommend a 15% tariff on copper imports, which could also rise to 30% from 2028. A final report is needed for President Donald Trump to decide.
Pinto noted that the document had a deadline of June 30 and was delivered, but it has not been made public and has had no consequences. In his view, markets already assume that some tariff percentage or a postponement may come.
Landeros offered a nuance: the scenario is possible, but "there is no 15% tariff that kicks in automatically on January 1."
If it materializes, the blow to Chile would be significant, although the country holds a strong card. According to the US Geological Survey, the US relies on net imports for 57% of its copper. In the latest official breakdown by origin, Chile accounted for 68% of its refined copper purchases.
To put it in perspective: of every ten kilos of refined copper the US buys abroad, almost seven come from Chile. That is why, according to Landeros, taxing that copper would also make more expensive an input that US industry itself needs, at least until the country develops more refining capacity of its own.
Taken together, both milestones, the November 3 election and the decision on copper, Chile's main export product, that could come in January, remain pending over the next three months.
