Copper's man of mystery
Class reunions are popular in China and last night a group of former Wuhan University students met in a Shanghai restaurant for a meal of hairy crab and Great Wall cabernet sauvignon. Unfortunately for the diners, the most famous class member could not make it.
When they last met, Liu Qibing - the absent classmate - was an official at a little-known government agency in Beijing that deals in commodities. This weekend he is at the centre of what could become a large international trading scandal involving vast numbers of copper contracts on the London Metals Exchange.
A week after Mr Liu was first reported to be responsible for the outstanding London copper trades, most of the key points of the case have yet to be clarified - whether he was acting on his own or under direction, whether the contracts will be honoured and just how large a position he had actually taken. Mr Liu himself has not been seen by neighbours or business counterparts since China's October 1 holiday, when rumours about large positions began to circulate. Yet the week has been long enough to expose some of the problems generated by China's dramatic economic transformation over the past two decades.
Trading scandals in derivatives markets are not a rarity and Mr Liu's positions pale in comparison with the problems caused in 1996 by Yasuo Hamanaka at Japan's Sumitomo Corporation. Mr Hamanaka bet on the LME that copper prices would rise and lost $2.6bn: Mr Liu appears to have bet on a fall in the price, with potential losses of much less than one-tenth of the size.
However, the unfolding copper saga has exposed China's vulnerability to these types of scandals and has shown that, despite the liberalisation that the Chinese economy has undergone, important economic functions are still conducted by obscure parts of the bureaucracy that resent any scrutiny of their operations.
While China was only a small player in the global economy, this did not matter. Yet given China's growing weight in many markets, the behaviour of these state entities has become much more important. This is nowhere more true than in commodities. Over the past decade, China has gone from being a relative minnow to being the number one consumer of copper, steel and iron ore and number two for oil and aluminium. China's copper consumption has nearly tripled in the past decade, almost half of which has to be imported.
To manage these trade flows, China has had to hire a new generation of officials to operate on the markets for these vital raw materials. Liu Qibing was one of those people.
Now in his late thirties, Mr Liu grew up in Xiaogan in central Hubei province before doing an economics degree in the provincial capital of Wuhan. Xiong Shengjie, a classmate, says he did not excel academically, but was good at basketball and Chinese calligraphy.
On graduating, he landed a job in Beijing with the State Reserves Bureau, a government agency that manages stocks of important commodities, but whose activities are usually a state secret. He impressed his managers enough to win a short-term posting to the LME, where he improved his English.
On his return, Mr Liu's trading skills won him a job at the State Reserves Centre for Supplies Reserve, a kind of trading arm of the SRB, where he headed the import-export department and was in charge of copper trading.
Dark haired and with thick, bushy eyebrows, the picture that emerges from colleagues and acquaintances is of an earnest, polite man who was far from the stereotype of a hell-raising trader. "He is a very likeable, low-key kind of guy," says one trader in Shanghai.
His Beijing apartment does not appear to be the residence of a man who has enriched himself though undercover trades. Right on one of the dusty ring-roads in the city centre, Mr Liu and his wife live in a small flat on the 10th floor of a dirty, yellow building reserved for officials at the SRB and a trade ministry.
According to a number of commodities traders, Mr Liu's problems started as early as May last year when China announced it would sharply cut credit to slow investment. The price of copper was then $3,000 a tonne. Expecting a slump in construction, Mr Liu and his seniors at the SRB and its trading arm bet that a slowing China would translate into softer copper prices. By early 2005, Mr Liu and the trading team affiliated to the SRB were still betting that prices would fall, the traders said. However, copper prices had begun to rise on the back of strong global economic growth. By yesterday, the price was $4,200.
Mr Liu's acquaintances emphasised it was a team effort. "Whenever a deal was being done, he would go off and get approval," says a Shanghai-based copper trader who knows Mr Liu. "He is not the kind of rogue trader that everyone is painting him to be. It sounds like he is being made a scapegoat."
Yet the Chinese government has told a very different story. Early this week, senior officials at the SRB insisted they did not know of Mr Liu or the copper contracts. Then on Thursday, the official China Daily reported that the government had conducted an initial investigation into the case and found that "Mr Liu alone should be blamed for the loss" on the copper contracts and was no longer an official.
If Mr Liu were a rogue trader, it could raise an issue of whether the contracts would be honoured. Depending on what form of documentation he produced when making the orders, the government could argue that it did not authorise the contracts. Most analysts think, however, that even if the Chinese government had a legal case, it would still take the loss, because it will need access to markets such as the LME in the future. If it transpires that Mr Liu was not acting on his own behalf, but was part of a team, then it will prompt much broader questions about Chinese conduct in financial markets.
In theory, only a limited number of institutions are allowed to operate on overseas exchanges and only then to hedge their exposure. However, the scandal last year at China Aviation Oil, when the Singapore branch lost $550m in oil futures, showed that some state-owned companies see derivatives as a potential source of profits.
The SRB has a broad range of responsibilities from stockpiling strategic goods such as oil and grain to distributing food and tents during national disasters. Using taxpayers' money to punt on complicated financial instruments in overseas financial markets is not in the remit of the government agency - not even in today's über-capitalist China. 新闻人物 : 神秘的铜交易员
同学聚会在中国很是盛行。上周五晚，一群武汉大学的同窗相聚在上海一家餐馆，共享大闸蟹和长城干红葡萄酒。不过，颇令用餐者遗憾的是，名气最大的班级成员未能到场。
神秘的缺席者
这位缺席者名叫刘其兵 (Liu Qibing, 音译 ) ，在上次聚会时，他还任职于北京一家不太为人所知的政府机构，是进行大宗商品交易的官员。而本周末，在一桩可能演变为巨大国际交易丑闻的事件中，他成了核心人物。该事件涉及伦敦金属交易所 (London Metals Exchange ， LME) 的大额铜金属合约。
从开始有报道称，刘其兵应对这笔未交割的伦敦铜交易负责，时间已过去了一周，而该事件的大部分关键要点仍未得到澄清― ―他是自行其事还是奉命从事？合同能否兑付？他究竟实际持有多大的头寸？自中国“十一” 假期之后，刘其兵的邻居或生意同行就再没见到过他，当时关于大额头寸的传闻已经开始流散。然而，短短一周的时间，已足以暴露中国过去 20 年来戏剧性经济变革所引发的若干问题。
交易丑闻在衍生品市场并不罕见。而且，与 1996 年日本住友商社 (Sumitomo Corporation) 滨中泰男 (Yasuo Hamanaka) 所造成的麻烦相比，刘其兵的头寸也算不上什么。滨中泰男押注伦敦金属交易所铜价走高，结果损失了 26 亿美元。而刘其兵似乎是押注铜价下跌，可能造成的损失还远不及前者的一成。
然而，铜金属冒险传奇的逐渐暴露，凸显了中国面对此类丑闻时的脆弱性。尽管中国经济已作出了自由化努力，但一些重要的经济职能仍由官僚机构中模糊不清的部门所把持，他们的运作情况不愿受到任何详细审查。
当中国在全球经济中只是一个小角色时，这种情况无关紧要。然而，随着中国在许多市场的份量日益加重，这些国有实体已经举足轻重。这一点在大宗商品市场上得到了最真切的体现。过去 10 年内，中国已从一个 “无名小卒”成长为铜、钢铁、铁矿石的最大消费国，同时是石油和铝的第二大消费国。过去 10 年间，中国的铜消费量已增长近两倍，其中近一半需要进口。
为了对这些贸易流动加以管理，中国不得不任用新一代官员，在关键原材料市场上进行运作。刘其兵就是其中的一个。
刘其兵现在年近 40 岁，在湖北省中部的孝感市长大，之后在省会城市武汉攻读经济学学位。他的同班同学熊圣杰 (Xiong Shengjie ，音译 ) 称，刘其兵的成绩算不上优秀，但在篮球和书法方面却颇有特长。
毕业后，他在北京谋到一份中国国家储备局 (SRB) 的工作。该政府机构管理重要大宗商品的库存，但其动向通常属于国家机密。他给上司留下了深刻的印象，从而获得了短期派驻伦敦金属交易所的机会。在那里，他的英语得到了提高。
回国后，刘其兵凭借自己的交易技能，在中国国家储备调剂中心获得一个职位。该机构类似于国家储备局的交易分支机构，刘其兵在此主管进出口部门，并负责铜金属交易。
低调的交易员
黑发、浓眉，同事们和熟人口中描述的刘其兵是一位彬彬有礼的热心人，与造成这场混乱局面的交易员形象相去甚远。“他是一位非常讨人喜欢、行事低调的人，”上海一位交易员称。
他在北京的公寓看起来不像是那种通过秘密交易致富的人的住所。这套公寓位于市中心一条布满灰尘的环路上。刘其兵和他妻子住在 10 层的一个小套间，那是国家储备局和某贸易部官员们居住的一幢不太整洁的黄色建筑物。
一些大宗商品交易员称，刘其兵的问题早在去年 5 月份就初露端倪，当时中国宣布将大幅削减信贷以减缓投资。当时的铜价为每吨 3000 美元。由于预计建筑领域将出现滑坡，刘其兵和他在国家储备局及调剂中心的上司们把宝押在中国经济增长放缓将导致铜价走低上。上述交易员表示， 2005 年初，刘其兵与国家储备局下属的交易团队仍押注铜价将会下挫。然而，随着全球经济的强劲增长，铜价开始上涨。截至昨日，铜价达到 4200 美元。
熟悉刘其兵的人强调，这是一种团体行为。 “无论何时，在进行一笔交易的时候，他都会进行汇报并获取批准，”一位认识刘其兵的上海铜交易员表示，“他不是大家形容的那种流氓交易员。听起来似乎他被当成了替罪羊。”
不过，中国政府讲述的是一个完全不同的故事。上周初，国家储备局高级官员坚持称，他们对刘其兵其人或铜金属合约均一无所知。此后，上周四，官方的《中国日报》报道称，政府已经对此事展开初步调查，发现在铜合约方面的“损失应归咎刘其兵一人”，同时他不再是政府雇员。
疑云重重
如果说刘其兵真是一个“流氓交易员”，那么就会引发关于这些合同是否能得到兑现的问题。依据刘其兵下定单时使用的文件格式，政府可能会辩称，自己并未对这些合同进行授权。不过，大多数分析师认为，即使中国政府有法律上的借口，它也将承担损失，因为它以后仍需要进入伦敦金属交易所等市场。如果有信息显示刘其兵的行为并非代表个人，而是集体决策，将会激起对于中国在金融市场中行为的更为广泛的质疑。
从理论上讲，仅有数量有限的机构获准在海外交易所进行交易，同时这样做只能是为了对冲风险。然而，去年的中航油 (China Aviation Oil) 丑闻显示，一些国有企业将衍生工具视为潜在的利润来源。该公司的新加坡子公司在原油期货交易中损失了 5.5 亿美元。
中国国家储备局肩负着广泛责任，从石油和谷物等战略物资的囤积，到发生全国性灾害时食品和帐篷的分配。利用纳税人的钱在海外金融市场上从事复杂金融工具的投机活动，这不是政府机构的职责所在――即便在当今日趋资本主义化的中国也不例外。
Copper Price Points To Beijing Activity
SHANGHAI
