China, the world’s top consumer of commodities, has promised to release more base metals from its reserves upon first batch sale as it continues to control surging raw material costs.
- The National Food and Strategic Reserves Administration stated that more sales are being organized to improve market stability.
- The first batch release of materials in 10 years consisted of 50,000 tons of aluminum, 20,000 tons of copper, and 30,000 tons of zinc.
- Shanghai Metal Exchange recorded acceptance of the highest bids, including 67,718 yuan ($10,474) per ton for copper, 18,074 yuan per ton for aluminum, and 21,200 yuan per ton for zinc, which were lower than spot market prices.
- The Chinese Authorities are releasing metal from their stockpiles as part of the program to control prices after factory inflation spiked to a record high in May.
The release of the reserves in several batches will reduce prices towards the normal price range in the market.
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Source: Bloomberg.