Metal prices slump on China state firms warning

Photo: AP

The global prices of industrial metals dipped as Chinese official state authorities issued a warning, directed to state firms, with a call to stop the aggressive buyer approach, BBC reported. As China is the biggest consumer of metals, the warning helped sinking the prices on all markets. China's National Development and Reform Commission (NDRC) urged the firms to maintain "normal market orders". The move comes after metal prices have surged in recent months as major economies emerge from the pandemic.

On London Metal Exchange, copper immediately dropped by 1.6% after the announcement, while aluminium slipped by 1.09%. According to a report by state media outlet The Global Times, key Chinese companies in steel, iron and aluminium were among those "collectively summoned" for interviews. The Global Times also quoted a statement by the NDRC saying the meeting was held due to the continuous and drastic increase of a handful of commodities. China already announced that it would step up measures around commodity supply, saying it would curb "unreasonable" prices. Commodity traders are also cautious after The White House said that it had cut back its infrastructure bill from $2.25tn to $1.7tn. With cuts to the spending plan being in broadband, roads and bridges demand for iron ore and copper could be curbed.

Global prices for many of the raw materials needed for industries - including copper, coal, steel and iron ore - have risen sharply this year as lockdowns and other measures to curb the spread of Covid-19 have been eased. Huge economic stimulus measures by governments and central banks across the world have also driven up demand for commodities.

Similar articles

  • UN warns of record food prices surging

    UN warns of record food prices surging

    The United Nations Food and Agriculture Organisation warned of possible global food shortage amid soaring costs related to pandemic, Reuters reported. The costs of imports monitored by FAO are seen soaring by 12% this year. The spike in costs is driven by extremely high demand in lockdown periods. The world's food import costs, which include shipping charges, is projected to reach to a record $1.715 trillion this year, from $1.530 trillion in 2020, FAO elaborated in its twice-yearly Food Outlook report.

  • UK seals deal with Norway, Iceland and Liechtenstein

    UK seals deal with Norway, Iceland and Liechtenstein

    UK announced it had achieved a post-Brexit agreement with three European countries, Reuters reported. Norway, Iceland and Liechtenstein which are part of the European Economic Area confirmed that the trade accords with Britain were sealed. The deals end a post-Brexit period which marked the separation of UK from EU.

  • Global food prices soar in May

    Global food prices soar in May

    Global food prices surged in May at its fastest pace since October 2010, BBC reported. The foods rose by 39.7 % on monthly basis, a report by the UN Food and Agriculture Organisation (FAO) showed. The robust growth of prices was largely due to pandemic restrictions which disrupted deliveries in some parts of the world. The UN uses a broad index of global food costs, which have also climbed for 12 months in a row.