Chinese copper mogul goes missing, possibly held by police
He Jinbi, a Chinese copper tycoon and the founder of Maike Metals International Co., has reportedly gone missing, with colleagues speculating that he may have been detained by police for questioning. Once China's largest importer of refined copper, Maike Metals faced a liquidity crisis last year that severely impacted the company. Sources say Jinbi was taken away by police in his home province of Shaanxi, but no reason for his detention has been given.
Maike Metals's rise and fall
Established in 1993 by Jinbi and a group of friends, Maike Metals initially traded mechanical and electrical products before shifting its focus to copper. The company played a vital role in connecting international traders and Chinese consumers during the 2000s commodity supercycle. At its height, Maike was responsible for a quarter of China's copper imports. However, the company's expansion into real estate and the effects of COVID-19 lockdowns contributed to its liquidity crisis last year.
Legal troubles and restructuring efforts
Since the company's financial troubles began, Maike and Jinbi have faced legal action from creditors. In February, the company filed a request for "preliminary restructuring" in an effort to resume trading metal. However, their continued absence from the market has negatively impacted liquidity in China's copper trade. Earlier this year, Jinbi was sued by ING Groep NV in Hong Kong over $147 million in unpaid debt, involving overdue payments owed by a trading arm of Maike.
China's crackdown on high-profile business figures
China has not hesitated to target high-profile business figures when their companies falter and consumers are affected. Notable examples include the billionaire chairman of China Evergrande Group Hui Ka Yan, who was taken into custody last month, and Chen Feng and Tan Xiangdong of HNA Group, who were detained in 2021. Detention does not necessarily mean charges will be filed, as demonstrated by Guo Guangchang of Fosun conglomerate, who briefly disappeared in 2015 before returning to work after assisting police.
Implications for the copper industry
The disappearance of Jinbi and the downfall of Maike Metals have sent shockwaves through the copper industry. As one of the sector's most influential players, Jinbi's potential detention raises questions about the future of China's copper trade and the government's approach to high-profile business figures. The situation also underscores the risks associated with rapid expansion and debt-fueled growth in an increasingly regulated market.
