- State Reserve Bureau tenders for 150,000 tons of refined metal
- Producers have lobbied government to intervene in price slump
China’s State Reserve Bureau is seeking as much as 150,000 metric tons of domestically produced refined copper for its stockpiles amid a collapse in prices to six-year lows, according to people with knowledge of the situation.
The state agency issued the tender, which closes Jan. 10, to multiple sellers including smelters at a meeting in Beijing on Tuesday, the people said, asking not to be identified because the information is private. The tender was reported late Tuesday by FastMarkets.com.
Smelters in China, the world’s largest producer and consumer of metals, are contending with a collapse in prices as the nation’s growth slows to its weakest in a quarter century. The SRB’s move to soak up excess supply follows industry pledges in December to cut output and sales, and lobbying of the government to step in to support the market.
Nobody answered phone calls and a fax seeking comment from the National Development and Reform Commission, which overseas the SRB. Calls to the SRB’s trading department also were unanswered.
China’s refined copper surplus was forecast to narrow last year to 1.14 million tons as imports fell, according to state-run researcher Beijing Antaike Information Development Co. in October. At the same time, Antaike projected that domestic production would grow 7.7 percent to 7.42 million tons.
Speculation last month that the SRB may intervene briefly boosted prices, although copper ended the year 25 percent lower. The agency bought cobalt in November after the metal fell to its lowest since June 2014. Copper for delivery in three months on the London Metal Exchange dropped 0.1 percent to $4,642.50 as of 1.48 p.m. in Shanghai.
Officials at China’s biggest copper smelters couldn’t be reached or declined to comment. Huang Dongfeng, the board secretary at Jiangxi Copper Co., didn’t immediately respond to calls seeking comment, while Wu Heping, his counterpart at Tongling Nonferrous Metals Group Co., declined to comment.
— With assistance by Alfred Cang, and Steven Yang