China is planning to purchase aluminium and copper for national storage

Insider indicated that the Chinese Government was trying to largely purchase base metals for national storage against the background of sliding prices on the expanding international crisis.

According to sources, the Chinese Government has made two schemes: first is to purchase all kinds of base metals; second is to purchase copper and aluminium only. And State Reserve Bureau or government-controlled commercial organization is likely to be responsible for the purchase. Sources revealed that some 20-30 billion RMB would be put in this plan.

Global financial crisis splashes unfavorable effect on Chinese economy as the international demand on base metals is shrinking. Many metals companies cut output and staff in order to survive. The Chinese Government is starting to strengthening the support to metals manufacturers by changing its long strategy of strictly restraining the development of resource-intensive metals industry.

In an announcement released by the government, the State Council is planning to further importing raw materials and resources from overseas countries to promote national and commercial storage.

Analysts and insiders said that this action of the government would exert copper price, and the aluminium prices too in a short term which would fall back soon on the large market storage.

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