China Metal Probe to Push Copper to LME Depots: Chart of the Day
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China’s probe into metals stockpiled at Qingdao Port may spur the migration of copper to near-empty London Metal Exchange warehouses in neighboring countries as banks grow wary of lending money against commodities.
The investigation into whether a Chinese trader used the same batches of metals multiple times to get bank loans risks undermining the attractiveness of offering credit to companies that pile commodities inventory into bonded warehouses in China. Copper is among the major raw materials used in commodity-backed financing in the country, the biggest user of metals.