Free Republic

Last week’s bid by the Hong Kong Exchanges (HKE) for the London Metal Exchange (LME) flew under the radar, but its underlying importance is paramount. In the most expensive bid ever for an exchange, HKE is looking to acquire the world’s largest metals market place for more than $2 billion, shifting the global hub for metals trading to the East.Furthermore, as China gradually becomes the world’s most important player in the gold and commodities markets, it will strengthen its grasp on the global gold trade, which it set out to do in its latest Five Year Plan. As the world...

A couple of interesting data points the last few weeks, on commodities oversupply. Last week CBI China reported that Chinese base metal stockpiles are reaching epic levels. CBI surveyed commercial warehouses in Shanghai plus three other provinces and found that metals inventories have continued to bulge. All told, 965,000 tonnes of aluminum and zinc are now held in storage across China. That's phenomenal inventory growth over the last few months. At the end of 2009, stockpiles stood at "just" 626,000 tonnes. We're up over 50% in a single quarter. And CBI expects inventories to keep rising, noting "We'll have 1...