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. Last Updated: 07/27/2016

China May Act to Calm Copper Crisis

HONG KONG -- China's Ministry of Finance may provide financial assistance to the government's State Reserves Bureau to end a crisis triggered by speculation about a huge short position on copper, traders said Wednesday.

"It's helping fight the battle," said one trading source in China, referring to the Finance Ministry.

The State Reserves Bureau is at the center of market speculation that a trader at the State Regulation Center of Supplies Reserve might have placed a large short position on the London Metal Exchange, on behalf of the SRB, with potential losses of up to $200 million.

But bureau officials have said any positions the trader, Liu Qibing, might be holding could be in his own personal account.

The SRB is believed to be seeking approval to let it export 200,000 tons of copper from stocks that are state assets and on which it is usually not allowed to make a loss.