China promises to release steel barns to deal with trees and fears of extinction
The stock market is on the verge of collapse after Chinese officials promised to release government stockpiles to address concerns over shortages and rising prices.
The National Food and Strategic Reserves Administration said in a statement Wednesday that it would release groups of metals, including copper, aluminum and zinc, to be available to manufacturers.
This comes after the government complained about a price tag meeting, which it has rejected factory gate prices to the point where it has risen since the 2008 financial crisis and threatened to squeeze business profits.
It shows recent attempts by Chinese policy makers to reduce commodity prices. Last month, China’s finance ministry warned of “extremism” and promised to curb the spread of fraud and secrecy.
Local media reports on Wednesday said Beijing had ordered state-owned enterprises to reduce their presence in foreign markets.
Iron prices fell on Tuesday, following speculation that China may be preparing to release its reserves. On Wednesday, bench bench prices were down 0.2% at $ 9,550 per tonne, while aluminum was down 0.4% at $ 2,458 and zinc fell by 1.75% at $ 2,978.
Iron ore has led to a major global price hike, triggered by a rapid recovery and the Chinese company’s response to the epidemic and a resurgence after another major economic boom began. Copper, which is used for everything from electric cars to household cables, rose sharply to $ 10,500 per tonne last month.
China has not officially declared its state-owned stockpiles, which act as insurance against property prices.
Based on the differences between net use and usage, researchers said Beijing could have saved 500,000 tons of copper, 1.5m of aluminum and zinc 700,000. However, he cautioned that this was just speculation. To look good, China consumes 15m tons of copper a year.
Colin Hamilton, a researcher at BMO Capital Markets, said there was no doubt that China would produce more steel in the market.
“I think this is another way to write to the Chinese market that they think prices should go down,” he said. “He believes the market is growing.”
Last month’s government warning on stock markets rose sharply, sending steel prices 10% lower. In 2020, China produced steel and mills that remained operational, despite efforts to reduce emissions from natural disasters.
China’s desire to produce zero emissions by 2060 will require a reduction in steel, which adds to the fears of a possible shortage and helps raise prices. The international position as a steel exporter, as well as the world’s largest exporter and producer, have added to these challenges.
Last month, the Chinese government issued a law calling for a ceasefire.