| HONG KONG
HONG KONG China's aluminum and nickel producers have asked Beijing to buy up surplus metal, sources said, the first coordinated effort since 2009 to revive prices suffering their worst rout since the global financial crisis.
The state-controlled metals industry body, China Nonferrous Metals Industry Association, proposed on Monday that the government scoop up aluminum, nickel and minor metals including cobalt and indium, an official at the association and two industry sources with direct knowledge of the matter said.
The request was made to the state planner, the National Development and Reform Commission (NDRC).
The NDRC and the metals industry association did not respond to requests for comment.
While it is not clear if the authorities will agree to the proposal, the approach underlines the extent to which loss-making smelters in the world's top producer and consumer are suffering from prices hovering at or near multi-year lows.
Major Chinese zinc smelters had already proposed that the sector slashes output by 500,000 tonnes next year, or around one month's production, in an attempt to boost prices.
The country's major nickel producers will meet on Friday to discuss potential output cuts of their own.
One source familiar with the producers' request said the China Nonferrous Metals Industry Association had suggested that the state buys 900,000 tonnes of aluminum, 30,000 tonnes of refined nickel, 40 tonnes of indium, and 400,000 tonnes of zinc.
Other sources did not specify zinc as being part of the plan.
All of the sources declined to be named due to the sensitivity of the matter.
While the proposal does not include copper, it is likely to revive memories of 2009, when the State Reserve Bureau (SRB) in Beijing swooped in to buy more than 700,000 tonnes of copper on the domestic and international markets.
Prices were languishing at around $3,000 per tonne at the time, and the buying spree reversed the falls and ultimately helped to propel prices to record highs above $10,000 per tonne in February, 2011.
The SRB considers copper a strategic metal.
The SRB is controlled by the NDRC, and any state purchases of most commodities are normally approved by the planner and executed by the bureau.
The push to get the government to bail out the industry is likely to stir debate over whether Chinese producers in particular are doing enough to limit oversupply that is overwhelming global demand.
In the United States, aluminum smelters have blamed ballooning exports from China for hurting international prices.
Nickel prices on the London Metal Exchange, which sets the benchmark for global trade, plunged to their lowest in more than a decade on Monday amid concerns about waning demand from China, the world's second-largest economy.
Few, if any smelters, are making a healthy profit at prices as low as $8,200 per tonne, down almost 60 percent since last year.
Aluminum prices have fallen nearly 30 percent over the past year.
(Reporting by Polly Yam; Editing by Josephine Mason and Mike Collett-White)