[Ferro-Alloys.com]}According to the foreign news, recently the Chinese State Reserve Bureau was actively looking for and buying the cooper and nickel products. While the news was not be made public, if the new was true, it would be the first time for the Chinese government to buy bulk products overseas since the financial crisis in 2008.

 

Generally, the main reason for the state reserve bureau to buy products was to maintain the price and promote the industry out of the trouble. For example, in 2012, the state reserve bureau bought Aluminum and zinc to relieve its overcapacity. Besides, recently, they asked the China Minmetals Non-Ferrous Metals Co., Ltd to buy 10,000tons tungsten concentrates for supporting the price.

 

While this time the state reserve bureau to buy overseas metals during the weak period might not for the purpose to regulating the market. According to the news, the state reserve bureau bought 200,000-300,000 tons cooper, the volume of which was just a tiny fraction relative to the LME copper stock. So it was hard for the supply and demand conditions to be changed for this matter. Even though the buying volume of the nickel—30,000tons, accounting for 16.7% of the total LME nickel stock, it was also very hard to change the global nickel market trend, as the world weak economy conditions was not easy to be improvement.

 

Some market players analyzed that there were main two reasons for the state reserve bureau to do this. One reason was the state reserve bureau could earn override profit for buying the metals in very low price and then sell them in comparatively high price. As now the copper price had already declined by 13% compared with early of 2013, it was a nice chance to buy. The other reason was that the state reserve bureau could increase the state reserve taking advantage of the low price, for the copper and nickel products was not rich in China while they were essential and widely used in the industry field. 

 

In a word, the influence for the Chinese state reserve bureau buying products in overseas and home was pretty different when the industry was in weak condition.

 

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