FX.co ★ China to Expand Strategic Metal Reserves

China is set to bolster its strategic reserves of crucial industrial metals such as cobalt, copper, nickel, and lithium. This move aims to enhance supply resilience amidst the rising demand driven by energy transition initiatives and increasing geopolitical tensions. According to Bloomberg News, the National Food and Strategic Reserves Administration has initiated price inquiries and submitted bids for certain metals. This follows directions from the National Development & Reform Commission (NDRC) to speed up stockpiling activities. However, the government remains reticent about the timing and magnitude of these purchases. In parallel, China is expanding storage capacities for vital commodities, including grain, oil, and fertilizers, while also seeking to diversify its suppliers. This strategy is designed to reduce risks associated with trade disruptions, some of which stem from U.S. tariffs. Recent limitations on supply and trade instability have contributed to rising metal prices, with copper hitting $10,000 per ton in London and cobalt experiencing a notable increase due to an export prohibition in the Democratic Republic of Congo.