The government has settled most of the wrong-way bets on copper futures made late last year, Bloomberg reported, citing Yang Yinghui, head of metals trading at Cofco Futures. The losing trades were made by state reserve trader Liu Qibing, who sold short on as much as 130,000 tons of copper on the London Metals Exchange in the anticipation that prices would fall. He was proved drastically wrong as copper prices have more than doubled from US$3,112 a ton on June 1 last year to a current value in the region of US$7,610. Traders have said that China covered the losses, thought to total millions of dollars, by delivering copper to LME-monitored warehouses and cash settlements. Warehouses in South Korea have seen a 16-fold increase in copper holdings over the past eight months. In January, the State Regulation Center of Supplies Reserve said it would ban units from trading futures to "avoid more huge losses", the first time it had acknowledged losses.
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