China to boost imports, reserves of key resources

Production and Markets

China, the world’s biggest metal consumer, should increase imports and reserves of strategic resources in 2010, according to the commerce ministry.

The increases should take place “at an appropriate time” and “unreasonable restrictions” on imports should be cleared, the ministry said in a statement on its website outlining goals for next year. The ministry did not identify the resources, or elaborate on the timing of the purchases.

Chinese state buying of raw materials for stockpiling in the first half of 2009 helped lift commodity prices, with copper and zinc doubling this year. The government’s US$586 billion stimulus plan also spurred buying, with imports of copper, soybeans and iron ore gaining to records.

“This will include copper, iron ore and uranium in our view,” Kevin Ji, an analyst at metal trader Ningbo Sunhu Chemical Products Co, said. “Current prices are not good for stockpiling such resources, though the government should step up doing so once prices are appropriate.”

The State Reserve Bureau, which manages government stockpiles, has bought copper, aluminum, zinc, indium and titanium this year, Caijing magazine cited Yu Dongming, an official at the National Development and Reform Commission, as saying in June.

The country was not expected to continue reserve buying amid market conditions at that time as previous purchases reached the objective of bolstering prices, the magazine cited Yu as saying then.

Copper in London gained for a second day on optimism demand in China is increasing as the country’s imports of the metal rebounded from an 11-month low. Refined copper imports were
194,388t in November, up 15% from the previous month, the customs office said.

Dec 22 (Bloomberg)