Tsingshan's founder, Xiang Guangda, told Chinese media outlet that "relevant government departments and leaders are all very supportive of Tsingshan. Tsingshan is a solid Chinese enterprise and our positions and operations do not have problems."
We talked on Tuesday about a hedging problem for nickel producers. If you make nickel and the price of nickel goes up, you will make more money, one day at a time, as you sell your now-more-valuable nickel. Meanwhile if you have hedged your nickel production by selling nickel futures on a commodities exchange, and the price of nickel goes up, you will get a margin call from your broker demanding that you put up a lot more money right now. Your stock of nickel in the ground and in warehouses has become more valuable, but it is not easy to turn that all into ready money; your short position in nickel futures has moved against you, and that does require ready money. In the worst case, you run out of money and lose your business even as it is becoming more valuable.
There is a variation on this problem.
