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Why Does Chinese Commodity Prices Suddenly Rise?
Sep 16, 2017

This week, Beijing also held an emergency meeting to discuss the surge in steel prices. According to the benchmark, China's steel prices last week reached the highest level in 4 years and 1/2 years.

Any more evidence? China's coal prices have risen by a two digit percentage in recent months - soaring more than $90 a tonne in recent weeks. Prompt officials to take emergency measures to cool prices in the market.

It won't stop here. The price of vanadium in China has doubled since last month, and gasoline prices have been rising in recent weeks. Even if prices soared on soybean meal.

So, what are the factors associated with these different goods?

Environmental Science

Traders, analysts and governments have been cited as one of the reasons for the recent Chinese commodity movement: the crackdown is currently being applied to national industrial centers that meet environmental requirements.

Sources say Beijing has recently launched an environmental measure to clean up smog for the upcoming winter. With government pressure, inspectors will shut down polluting factories, mines and processing facilities by September.

It is reported that the focus is widespread. In many provinces, 28 cities have targeted inspections.

Regulators have been quick to start work. As many as three inspections have been carried out and the fourth round of inspections has been imminent.

These inspections have had a major impact on metals, energy and other aspects of production. It is reported that most of the facilities in the zinc industry have been closed at the time of the inspection.

The big question is: how many of these actions will eventually be restarted? Officials say many of the facilities inspected in the sectors of refining and steel production have not yet met basic emissions standards.

This means failing to comply with the required facilities, either by upgrading pollution control or by completely closing down. This means that it may take months or even years, and many people will be able to return to the internet.

Such a large shutdown will make China's commodity price rise more than temporary. The continuing rise in China's prices will almost certainly bring upward pressure on the world's exchange rate as import demand increases to fill the gap in domestic output decline.

No one sees all this coming. And it's growing very fast. Read the news about how many details of China's facilities will be closed temporarily and forever - its goods will receive the greatest boost in global demand.

Haining Rishine LED Lighting CO.,LTD

Tel:  86-573-87097218


Add: No.27 shijing RD,Economic Development Zone,Haining,Zhejiang