Glencore’s Glasenberg says China can’t cool commodities for long

Copper still burning hot. (Stock image)

Ivan Glasenberg, the billionaire boss of Glencore Plc, said China’s efforts to cool surging metal prices can’t be sustained for long.

“The Chinese are trying to push it down, bring it back to lower levels,” Glencore’s outgoing chief executive officer said Tuesday at the Qatar Economic Forum. “I think that’s a short-term game because the underlying fundamentals will keep it at these levels.”

China, spooked by a surge in commodity prices from copper to iron ore, has rolled out several measures this year in a sweeping effort to stem inflation by cooling the runaway raw materials. That includes plans to release metals such as copper, aluminum and zinc from its strategic reserves for the first time in a decade.

RELATED: Copper supply needs to double by 2050, Glencore CEO says

The impacts of such a move would be short lived as soon China would have to replenish those stocks, said Glasenberg, who will leave Glencore at the end of this month after heading the world’s biggest commodity trader for almost two decades.

Glasenberg said he expects metal prices to remain strong for a long while yet as demand from China coincides with looming infrastructure spending in the U.S.

Metal prices have cooled in recent weeks, falling from record highs, as the U.S. Federal Reserve signals higher rates combines with China’s measures to cool commodities prices.

(By Thomas Biesheuvel, with assistance from Francine Lacqua)

Comments

Your email address will not be published. Required fields are marked *

More News