Industrial metals came to the fore after Chinese authorities promised to release government reserves to address concerns about shortages and high prices.
The National Food and Drug Administration (FDA) said in a statement on Wednesday that it would release batches of metals, including copper, aluminum and zinc, making them available to producers.
The move comes after the government became concerned about raising the price of goods, which prompted it. factory gate prices Their highest rate since the 2008 financial crisis threatened to squeeze industrial profits.
This marks the latest attempt by Chinese policymakers to lower commodity prices. Last month, China’s economic planning agency warned of “excessive speculation” and promised to address the spread of false information and backup.
According to local media on Wednesday, Beijing has ordered state-owned enterprises to limit their influence in foreign markets.
Metal prices initially fell on Tuesday following speculation that China may be preparing to cut reserves. Leading copper prices fell 0.2 percent to $ 9,550 a tonne on Wednesday, while aluminum fell 0.4 percent to $ 2,458 and zinc was down 1.75 percent to $ 2,978.
Metals led to a large-scale aggregate rise in commodity prices, which was initially fueled by the epidemic of China արագ rapid industrial recovery ացավ intensified after the recovery of other large economies. Copper, used in everything from electric vehicles to household wires, hit a record high of more than $ 10,500 a ton last month.
China has not officially disclosed its state reserves of industrial metals, which it holds as insurance against rising prices.
Based on the difference between net supply and consumption, analysts say Beijing could store 500,000 tons of copper and 1.5 meters of aluminum up to 700,000 tons of zinc. However, they warned that these were only informed predictions. In order for these figures to be promising, China consumes about 15 million tons of copper a year.
Comin Hamilton, an analyst at BMO Capital Markets, says it is unlikely that China will bring a significant amount of metal to market.
“I think this is another rhetoric to tell the Chinese market that they think prices should be lower,” he said. “They hope the market will sort itself out.”
Last month, the government’s warning about commodity market speculation hit prices hard, with iron ore prices down 10 percent. In 2020, China produced record volumes of steel, and factories remain active despite the drive to limit production due to environmental concerns.
By 2060, China’s claim of zero emissions will require a reduction in metal production, raising concerns about a possible shortage and contributing to higher fuel prices. The country’s role as a major exporter of metals, as well as the world’s largest consumer and producer of goods, has added to these concerns.
Last month, the Chinese government released a draft regulation requiring energy-efficient projects to assess their carbon emissions.