China Said to Purchase 290,000 Tons of Aluminum (Update1)

China, the word¡¯s largest producer of aluminum, will buy a further 290,000 metric tons from domestic smelters to support the industry after the first purchase in December, three people said.

China¡¯s State Reserve Bureau will buy the metal at 12,490 yuan to 12,500 yuan ($1,829) a ton, said three people who had direct knowledge of the meeting in Beijing today. The amount, equal to a third of the country¡¯s monthly output, will be delivered before April 15, they said.

This is the second step in the government¡¯s plan to stockpile 1 million tons of aluminum to boost reserves and stimulate the economy, according to CRU International Ltd. Prices of aluminum, used in homes and cars, have gained 5 percent in China since the December purchase.

¡°The amount, though lower than expectations, is going to support Chinese aluminum prices in the near term,¡± said Wan Ling, a CRU analyst, by phone from Beijing today. ¡°Higher Chinese prices will lead to more imports if London stays low.¡±

Aluminum Corp. of China Ltd., the country¡¯s largest smelter, will supply 140,000 tons, and 10 other companies will share the rest, the people said.

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