South Korea Plans to Boost Aluminum, Copper Reserves

March 12 (Bloomberg) -- South Korea, Asia’s third-biggest metals buyer, will boost stockpiles of aluminum and copper by as much as 46 percent this year, joining China in building inventories as commodity prices drop to seven-year lows. Aluminum reserves will rise 46 percent from a year earlier to 114,000 metric tons, while copper will gain 23 percent to 55,000 tons, the Public Procurement Service said in an e-mailed statement today. The agency last month said it will boost metals reserves by 37 percent this year to 205,507 metric tons. Commodity prices dropped to the lowest since June 2002 this year as the global recession crimped demand from builders and automakers. China, the world’s largest metals consumer this year has bought aluminum and zinc for its stockpiles, and also agreed last month to invest $22 billion in mining companies. “The crisis of today is actually an opportunity,” Kwon Tae Kyun, administrator of the state agency, said in the statement. “This year is the best time to build up stockpiles as much as possible at lower costs.” Copper futures on the London Metal Exchange slumped 54 percent last year, while aluminum dropped 36 percent. South Korea relies on imports for 97 percent of its raw material needs, and the state procurement agency meets about 8 percent of demand and often sets domestic benchmark prices. The agency will also boost stockpiles for minor metals by more than seven times to 17,500 tons this year, the statement said. Reserves for zinc and lead will be cut by 28 percent and 21 percent, respectively, to 9,000 tons and 7,000 tons, it said, without elaborating. Tin and nickel stockpiles will also decline, it said. To contact the reporter on this story: Sungwoo Park in Seoul at spark47@bloomberg.net.