Mining group Glencore faces disruption at its largest partner for selling refined copper in the Chinese market as Maike Metals International, a powerful trading house, grapples with a liquidity crisis.The slowdown in the Chinese economy and the downturn in the real estate market have caught out several domestic trading houses, leading to a string of recent scandals including missing copper at warehouses.
Glencore was selling about 600,000 tonnes a year of high purity copper into China through Maike, before the Xi’an-based trading group ran into liquidity constraints, according to people familiar with the matter. That level is equivalent to a fifth of Glencore’s sales of copper metal and concentrates last year, according to its annual report.
Glencore’s sales volumes through Maike had more recently been reduced, one of the people added.