Network Metals LLC

A flurry of news out of China today is supporting our various positions on the Chinese reserves purchasing and scrap shortages. Firstly, Hunan Nonferrous Metals Corp Ltd announced that it will boost its reserves by spending as much as $176 million as metal prices, aside from copper, continue their slumps. Also as we have already been talking about over the past couple of months, Scotia Bank today addressed the scrap shortage, brought on by significantly less global consumption, and how it is still driving up imports of copper metal into China, which is replacing the missing scrap. This will probably contribute to continued rising copper prices in the near-term, but we expect the correlation between equities and copper to give way to the actual fundamentals, which are not well supported in terms of supply and demand.