Rumours about China's State Reserve Bureau planning to buy 300,000 tonnes of copper have refused to die down more than a week after they first surfaced, even though market participants are sceptical about a state purchase at current prices.

“The SRB has been sending out enquiries since early this year,” a source who looks after copper trading at a smelter told Metal Bulletin. The smelter’s last contact with the SRB was the week before last, and [the SRB] “didn’t give any definite plan”. “Price is a big issue affecting SRB’s potential purchase,” the source said.

“The SRB’s potential purchase [in terms of volume and time] will depend on the direction of future prices. I think a price near $6,500 per tonne might be acceptable for them,” a senior broker from CIFCO said.

The spot copper price on the Changjiang Nonferrous Metals Market was at 51,480-51,520 yuan ($8,413-8,419) per tonne on Monday December 23.

The SRB also seems to have expressed an interest in imported material this time around. “The SRB contacted us and asked about the bonded copper price. They reverted with a high interest in cif cargoes and are waiting for the appropriate price,” a physical broker said.

“Imports data in the first quarter of 2014 will show whether the SRB stockpiled. For example, in 2009, imports of copper in Jan-May increased 53% over the previous year,” a senior broker said.

“This is not the first time this year that news about the SRB’s potential purchase has become widespread. In early June, it was heard that the SRB would stockpile 20,000-30,000 tonnes copper in the following months,” the CIFCO broker said.

“I believe the SRB does have a plan to stockpile copper and has already got a government grant but it’s impossible for them to buy at current prices,” the source said.

The last copper purchase made by the SRB was in the first half of 2009, when copper prices were about $3,000-4,000 per tonne after the financial crisis. The stockpiling aided several smelters at the time. 

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