Yunnan provincial government recently issued policies to support key producers in managing commercial reserves of non-ferrous metal products. Reserves are to be developed in accordance with the principle of “initiation and activity by producers with full business liabilities, backed by bank loans and financial subsidies from the government, and are to be managed by a market approach”. Key nonferrous metals producers in Yunnan are encouraged to reserve a total of 800 kt of nonferrous metals including copper, aluminum, lead, zinc, tin, germanium, indium and other key non-ferrous metal products for one year.
The funds needed for reserves will be borrowed from banks by producers in the form of product pledge. Producers will be permitted to mortgage their products to obtain a loan to raise the fund needed for reserves. Provincial finance will earmark a fund of RMB 1 bln as partial interest discounts on bank loans to producers. Producers who hold reserves of tin, germanium and indium will be entitled to a 80% discount on interest and producers with copper, aluminum, lead and zinc assets are entitled to a 60% discount.