China Expands Strategic Metal Reserves with Cobalt and Copper Stockpiling

Cobalt 

Beijing Strengthens Supply Security Amid Geopolitical Tensions

China is set to increase its strategic reserves of critical industrial metals, including cobalt, copper, nickel, and lithium, as part of efforts to secure its supply chains amid rising energy-transition demand and global trade uncertainties.

According to sources familiar with the discussions, the National Food and Strategic Reserves Administration has been making price inquiries and bidding for these metals. The National Development & Reform Commission (NDRC) previously signaled this initiative in its annual parliamentary report, emphasizing the urgency of stockpiling strategic commodities.

State Stockpiling and Market Impact

China’s state reserves agency, formerly known as the State Reserve Bureau, plays a significant role in stabilizing market prices through its large-scale commodity purchases. The government has been expanding its metal stockpiles, particularly cobalt, and has rotated old copper inventories to maintain supply efficiency.

Beijing’s strategic reserves primarily ensure availability during supply disruptions, but they also help balance market volatility. While China occasionally announces stockpiling plans, details on timing and quantities remain confidential.

The NDRC’s broader stockpiling strategy includes expanding storage for essential commodities such as grain, cotton, sugar, meat, fertilizers, and crude oil. It aims to enhance the management and operational efficiency of these reserves.

Global Market Implications

China’s stockpiling efforts coincide with heightened global trade disruptions. Copper prices surged past $10,000 per ton on the London Metal Exchange, reaching the highest levels since October. Meanwhile, New York’s Comex prices neared record highs, driven by U.S. trade policies, including a recent investigation into copper imports ordered by former President Donald Trump.

Cobalt prices have also spiked following an export moratorium from the Democratic Republic of Congo, the world’s largest producer. This has contributed to market tightening, further emphasizing the importance of China’s metal stockpiling strategy.