Nov 30 – Chinese metal producers have taken two steps to arrest the slide in prices, one that’s both sensible and has a reasonable chance of working, while the other is bad policy that would only provide a temporary boost.
The good idea is moving to lower output of refined copper, zinc and both refined nickel and nickel pig iron.
The not-so-good idea is to try to convince the government to start buying up various metals, including aluminium, in a bid to soak up surplus production and support prices.
Nine large Chinese copper producers have agreed an initial plan to cut output of refined metal by 200,000 tonnes next year, equivalent to about 5 percent of this year’s output, following a meeting of companies on Nov. 28.
The nine producers, who account for 60 percent of China’s refined copper output, may make bigger cuts and may announce targets this week, according to an executive at one of the companies, speaking on condition of anonymity.
The copper producers joined zinc and nickel counterparts, who said they were also planning output cuts.
Eight nickel producers said they would cut output by 15,000 tonnes in December, and by 20 percent in 2016 from this year’s level.
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