Beijing is expected to maintain or even accelerate its pace of commodity stockpiling in response to economic pressures in 2025, according to Caixa Bank’s February research report.
This build-up of reserves could drive up commodity prices, fuelled by rising demand from China and higher allocations for insurance premiums on these goods.
Further adding to the upward pressure on risk premiums is the fact that about 45% of China’s imports consist of crude oil and its derivatives, which are shipped through the Malacca Strait — a “geographical choke point” — as described by Caixa.
