China begins buying metal in rescue bid
Dec 23, 2008 | 12:38 PM
| Josephine Mason
China's State Reserve Bureau (SRB) has purchased aluminum from state-owned producer Aluminum Corp. of China Ltd. (Chalco), marking the government's first move to prop up the ailing market, according to market speculation.
The SRB bought about 300,000 tonnes on Tuesday from Chalco, market sources claimed.
The move appears to confirm rampant speculation that the SRB would start buying base metals to rescue its domestic producers as demand all but grinds to a halt.
Rumors have been circulating for several months about a possible buying spree, but Tuesday's purchase is the first indication that the SRB has entered the market. News of the SRB's move helped to boost prices in Shanghai and prevented prices on the London Metal Exchange from falling far despite another large inflow of metal in warehouses. ....
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