China: measures to make sure the soundness of commodity costs

China will take additional motion to curb rising commodity costs and crackdown on hoarding and commodity hypothesis, marking a key step in making certain secure costs and provides available in the market, officers mentioned. and specialists on July 19.

Wan Jinsong, director of the pricing division of the Nationwide Growth and Reform Fee, mentioned the fee will work with the departments to unlock extra copper, aluminum and zinc from nationwide reserves to spice up the provision of the nation. market and alleviate strain on manufacturing and enterprise operations.

Within the subsequent step, regulators will carefully monitor the event of commodity costs, strengthen regulation of the futures and spot markets, and crack down on market violations resembling hoarding to take care of regular market order, in keeping with Wan. .

On July 5, the NDRC and the Nationwide Meals and Strategic Reserves Administration accomplished the primary launch of nationwide reserves, publicly auctioning 100,000 metric tonnes of copper, aluminum and zinc. Greater than 200 non-ferrous steel processing and manufacturing firms participated within the public sale, and transaction costs had been about 3-9% beneath market costs that day, Wan mentioned.

“It’s believed that the discharge (of nationwide reserves) has despatched a optimistic sign that the federal government will assure secure provides and costs of uncooked supplies, which helps stabilize market expectations,” she mentioned. “The exit supplies a window of alternative for intermediate and downstream processing and manufacturing firms to replenish their inventories, and it additionally helps some firms scale back the price of uncooked supplies.”

Specialists mentioned they consider that with the assistance of efficient authorities measures to make sure secure costs and provides of uncooked supplies, costs will regularly return to an affordable vary.

Zhou Maohua, analyst at China Everbright Financial institution, praised the measures taken by the federal government to curb rising commodity costs and crackdown on unlawful actions resembling hoarding, saying that the components supporting this cycle of hypothesis on commodities weaken.

“Commodity costs will stabilize with the regular restoration of the world economic system, the tightening of the financial and monetary setting and the resumption of commodity provides,” Zhou mentioned.

Tao Jin, deputy director of the macroeconomic analysis middle of the Suning Institute of Finance, mentioned that whereas the beneficial properties in commodity costs have led to revenue progress for China’s industrial sector at an early stage, the value enhance will now result in a elevated manufacturing prices. for firms in intermediate and downstream manufacturing industries and can enhance dangers within the nation’s industrial chain.

He mentioned extra efforts must be made to extend home provides, crack down on irregularities on market violations, strengthen cooperative improvement of international mineral assets, and encourage home manufacturing and mining firms to take a position overseas.

At a July 19 press convention in Beijing, NDRC spokesperson Yuan Da mentioned that China’s economic system has grown steadily within the first half of 2021 and that the nation has the arrogance to realize it. annual progress goal deliberate for this yr.

Yuan mentioned the NDRC will make an incredible effort to proceed to deepen structural reforms on the provision aspect, give attention to increasing efficient home demand, additional help the event of the true economic system, push ahead with reforms. and openness, and try to maintain the economic system in good working order. inside an affordable vary.
Supply: Central Individuals’s Authorities of the Individuals’s Republic of China

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