Some Traders Looking to Move Metal Out of China’s Port of Qingdao; Sources Say Metal Owners Are Inquiring About Moving Metal to Korea or Taiwan
June 13, 2014 Leave a comment
Some Traders Looking to Move Metal Out of China’s Port of Qingdao
Sources Say Metal Owners Are Inquiring About Moving Metal to Korea or Taiwan
TATYANA SHUMSKY
June 10, 2014 7:14 p.m. ET
Metal warehouse operators in South Korea and Taiwan are receiving inquiries about moving metal held in the Chinese port of Qingdao to their facilities in the wake of an investigation into irregularities at the port, according to people at three warehouse companies.
Metal owners are looking to shift their stocks from China to warehouses in the region that are licensed by the London Metal Exchange, a person at one of the warehouse companies said. LME-licensed warehouses in Korea and Taiwan are among the facilities closest to China, reducing the cost of shipping metal from Qingdao, the person said.
Chinese authorities have launched a probe into metals-warehousing practices in Qingdao, the third-largest port in China, amid concerns that a trading company used the same warehouse receipts as collateral to secure loans at several different banks.
“People were asking about moving copper out of China and getting it into Taiwan or Korea as early as last week,” said a source at one LME warehouse operator.
The LME’s global warehouse system is the world’s largest metals-storage network, with more than 700 locations.
However, a person at a different warehouse company said the inquiries aren’t likely to result in metal leaving Qingdao anytime soon.
“This is going to be a long, dirty process,” he said.
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