{"id":43936,"date":"2025-09-30T11:44:27","date_gmt":"2025-09-30T11:44:27","guid":{"rendered":"https:\/\/quickassetsmarket.com\/index.php\/2025\/09\/30\/chinas-production-caps-and-sustainability-drive-reshape-the-base-metals-market\/"},"modified":"2025-09-30T11:44:27","modified_gmt":"2025-09-30T11:44:27","slug":"chinas-production-caps-and-sustainability-drive-reshape-the-base-metals-market","status":"publish","type":"post","link":"https:\/\/quickassetsmarket.com\/index.php\/2025\/09\/30\/chinas-production-caps-and-sustainability-drive-reshape-the-base-metals-market\/","title":{"rendered":"China\u2019s production caps and sustainability drive reshape the base metals market"},"content":{"rendered":"
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The global base metals market is bracing for significant shifts following a series of announcements from China, the world’s largest consumer of these raw materials. <\/p>\n

New production caps on non-ferrous metals and an increased emphasis on recycling are set to redefine supply dynamics, potentially offering price support while also introducing long-term uncertainties.<\/p>\n

On Sunday, China\u2019s Ministry of Industry and Information Technology revealed plans to limit the average annual production growth of 10 key non-ferrous metals, including copper and aluminum, to a mere 1.5% for this year and next.<\/p>\n

This marks a drastic reduction from the approximately 5% growth seen over the past two years, and even higher for copper, which grew by over 5% in both 2023 and 2024.<\/p>\n

Neil Welsh, head of metals at FCA-regulated multi-asset brokerage Britannia Global Markets, said:<\/p>\n

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Beijing is putting more weight on recycling, and the roadmap seeks to achieve breakthroughs in high-end products and help companies enhance global competitiveness.<\/p>\n<\/blockquote>\n

Addressing overcapacity and promoting sustainability<\/h2>\n

This strategic move by Beijing is a two-pronged approach, primarily aimed at tackling the pervasive issue of overcapacity within Chinese industries, which has severely eroded profit margins. <\/p>\n

Beyond economic concerns, sustainability is playing an increasingly vital role in these policy decisions. <\/p>\n

As stated by Thu Lan Nguyen, head of FX and commodities research at Commerzbank AG, “more emphasis is to be placed on secondary production, i.e., the recycling of raw materials.”\u00a0<\/p>\n

This commitment to a circular economy was foreshadowed months ago when the Chinese government relaxed import restrictions on scrap materials to ensure a consistent supply for domestic industries.<\/p>\n

However, the long-term impact of this shift remains to be seen as Nguyen noted:<\/p>\n

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In the long term, this could mean merely a shift from primary to secondary production, which might mitigate the price-supporting effect of slower growth in primary production. <\/p>\n<\/blockquote>\n

While initial price support is anticipated from reduced primary production, the eventual ramp-up of secondary production could offset some of those gains.<\/p>\n

Mixed signals from PMI data<\/h2>\n

Adding to the nuanced picture, official Purchasing Managers’ Indices (PMIs) released early this morning indicate a stabilization of business sentiment in China, hovering near the neutral 50-point mark. <\/p>\n

While the manufacturing sector index saw a slight improvement, it remains just below 50, signaling a modest decline in activity. <\/p>\n

“The most important market for base metals is stagnating, which is likely to limit further upward potential for prices,\u201d Nguyen added. <\/p>\n

This suggests that while supply-side constraints from the new production caps may offer some price support, sluggish demand in the key Chinese market could temper any significant rallies.<\/p>\n

Tin prices surge amid Indonesian mine closures<\/h2>\n

In a separate development, tin prices witnessed a substantial 3% climb yesterday, reaching a six-month high. <\/p>\n

This surge is attributed to reports that the Indonesian president has ordered the closure of up to 1,000 illegal mines. <\/p>\n

Indonesia, a significant player in the global tin market, experienced a slump in production to a 20-year low last year due to stricter regulatory controls, according to ITRI, the International Tin Association. <\/p>\n

Exports had subsequently fallen sharply, though they had recovered significantly this year.<\/p>\n

The immediate impact of these closures on global supply remains a point of speculation. <\/p>\n

Barbara Lambrecht, commodity analyst at Commerzbank, said:<\/p>\n

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The extent to which there will actually be significant supply shortages remains to be seen. <\/p>\n<\/blockquote>\n

Last year, Indonesia accounted for a considerable 16% of global tin production, according to the USGS, indicating that any sustained disruption could have a noticeable effect on international markets. <\/p>\n

The tin market will be closely watching for further developments on this front as the new week unfolds.<\/p>\n

The post China’s production caps and sustainability drive reshape the base metals market<\/a> appeared first on Invezz<\/a><\/p>\n

<\/p>\n","protected":false},"excerpt":{"rendered":"

The global base metals market is bracing for significant shifts following a series of announcements from China, the world’s largest consumer of these raw materials.  New production caps on non-ferrous metals and an increased emphasis on recycling are set to redefine supply dynamics, potentially offering price support while also introducing long-term uncertainties. On Sunday, China\u2019s <\/p>\n","protected":false},"author":1,"featured_media":43937,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[5],"tags":[],"class_list":{"0":"post-43936","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-investing"},"_links":{"self":[{"href":"https:\/\/quickassetsmarket.com\/index.php\/wp-json\/wp\/v2\/posts\/43936","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/quickassetsmarket.com\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/quickassetsmarket.com\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/quickassetsmarket.com\/index.php\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/quickassetsmarket.com\/index.php\/wp-json\/wp\/v2\/comments?post=43936"}],"version-history":[{"count":0,"href":"https:\/\/quickassetsmarket.com\/index.php\/wp-json\/wp\/v2\/posts\/43936\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/quickassetsmarket.com\/index.php\/wp-json\/wp\/v2\/media\/43937"}],"wp:attachment":[{"href":"https:\/\/quickassetsmarket.com\/index.php\/wp-json\/wp\/v2\/media?parent=43936"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/quickassetsmarket.com\/index.php\/wp-json\/wp\/v2\/categories?post=43936"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/quickassetsmarket.com\/index.php\/wp-json\/wp\/v2\/tags?post=43936"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}