China¡¯s Copper, Aluminum Imports Climb to Record (Update3)

China, the world¡¯s biggest metals consumer, increased imports of copper and aluminum to a record in April as buyers replenished stockpiles needed for the country¡¯s 4 trillion yuan ($586 billion) stimulus program.

Inbound shipments of refined copper advanced 7 percent from the previous month to 317,947 metric tons and were more than double the same month last year, final customs data showed today. Imports of primary aluminum surged to 362,400 tons, about four times the volume in March.

China¡¯s urban fixed-asset investment climbed 30.5 percent in the first four months from a year earlier as the government pumped money into building railways, low-cost housing and oil pipelines. Copper, used in power grids and homes, jumped 49 percent this year in London as China boosted purchases amid the worst global recession since the Great Depression.

¡°Imports of both metals probably peaked in April,¡± Ruan Yinan, an analyst at trader Yatong Metals (Shenzhen) Co. said today. ¡°Buying foreign copper has become almost money-losing and profit margins for aluminum have also fallen.¡±

China¡¯s economy faces ¡°great uncertainties¡± as the impact of the global crisis deepens, the state-run Xinhua News Agency said yesterday, citing Vice Premier Li Keqiang. A recovery could be a ¡°zigzagging and complicated¡± process, Li said.

Copper imports ¡°are expected to fall from now on as increasing shipments have pushed down prices in Shanghai compared with London,¡± said Zhao Kai, an analyst at Jinrui Futures Co. April shipments were the highest ever, Zhao said.

Slowing Purchases

Refined copper imports by China will slow over the rest of this year as scrap supplies improve, said Ma Xiaoqin, deputy- general manager of the copper department at Minmetals Nonferrous Metals Co., the country¡¯s largest trader, on May 8.

The State Reserve Bureau has mostly completed its buying and stockpiling by manufacturers has ended, said Edward Fang, an analyst at China International Futures (Shanghai) Co.

The premium for immediate delivery in Shanghai over futures has fallen to below 500 yuan a ton from as high as 2,300 yuan last month, Fang said by phone today.

The State Reserve Bureau contracted to take 300,000 tons to 400,000 tons of refined copper into its stockpiles from overseas this year, according to Macquarie Group Ltd. analysts. The bureau bought 590,000 tons of aluminum from domestic smelters this year for strategic reserves, traders said. Calls to the bureau in Beijing seeking comment were not answered today.

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