Analysts think they have identified a potentially worrying trend from China for commodities producers: The country has been eating into its commodities reserves.

The result has been a reduction in demand from China in some commodities markets, an absence that has helped weigh on commodities prices.

The Dow Jones-UBS Commodity Index last week dropped to its lowest level since July, before recouping some of its losses. The index is down 9.9% this year.

Given China's size and its voracious consumption, accurately" target="_blank" title="ad.准确地；精密地">accuratelyreading stockpile movements is a focus for analysts. They are paying attention for any signs of slowing demand because of China's recent moves to tightenmonetarypolicy to help stop the economy from overheating.

But the reporting of storage levels is patchy and inconsistent, making it difficult to assess.

Many analysts spend days in remote Chinese outposts, checking stockpile levels. Others analyze satellite photographs to determine storage levels or cultivate on-the-ground sources to dig up information.

It all gives a picture, however fragmented, of the strength of demand, and the future strength of commodity prices.

'If you don't have any accurate number to show how much stocks are going up or down, there'll be a big discrepancy' in views, said Sung Yoo, a commodities analyst with J.P. Morgan.

The situation has sparked debate among analysts, many of whom are alert to even a slight change in Chinese demand, about whether the reduction in stockpiles is a sign of slowing demand.

Some are concerned that manufacturers are responding to fewer orders from customers, preferring to use the materials they already have rather than add to their commodities stocks.

Others said Chinese commodities users are being savvy, waiting for market prices to decline further before stepping up buying. As prices reach a bottom, they will return to the market, the reasoning goes.

Either way, the lack of Chinese buying likely will weigh on prices over the next few months before any rebound, analysts said.

Analysts at Deutsche Bank said price declines for metals are likely, and the third quarter may see 'considerable pressure.'

Further policytightening by China and any potential economic slowdown pose risks to metals such as copper and nickel, the bank said in a note to clients Friday.

After a recent field trip to China, analysts at Macquarie Securities said some end users of steel, such as auto makers and white-goods producers, are 'choosing to eat into their own inventory, rather than continue to purchase' on the open market.

It is a typical 'buyers' strike' when prices are falling, the analysts wrote. 'Why buy steel today when it'll be cheaper tomorrow?'

Since late April, the benchmark hot-rolled flat steel price has fallen as much as 10%, to $600 a metric ton in China, according to the Steel Business Briefing, a firm that tracks steel data. Iron-ore prices dropped 23% in that period, as steel mills waited on the sidelines.

But the Macquarie analysts concluded that underlying demand for cars and refrigerators in China remains robust and that manufacturers soon will stop draining their own stockpiles.

'We expect conditions to turn around fairly rapidly,' they wrote. Macquarie estimated China's steel inventory peaked in January, and has since dropped about 15%.

Lower steel prices will result in production cuts at mills and help balance the market, they said. The bank estimated steel demand will recover in the fourth quarter.

Barclays Capital metals analyst Natalya Naqvi estimated China also has been eating into its stockpiles of lead since March.

Imports of the material are down the past two months.

China consumes about 40% of the world's lead, which is used primarily in making auto batteries.

'Given the macroeconomic data and auto sales in particular have been strong,' Ms. Naqvi wrote that it may 'reflect some running down of domestic stocks.' Aluminum and zinc also showed a drawdown in stocks.

Since mid-April, prices for lead plunged as much as 26%, compared with an 11% decline in the Dow Jones-UBS Commodity Index.

Ms. Naqvi expects China to turn into a net importer of lead again 'towards the end of the year,' giving prices room to rise.

China's oil stocks, in particular, have generated divided views.

In April, China reported that its crude-oil net imports jumped 33%, to 20.98 million metric tons.

Paul Ting, president of Paul Ting Energy Vision, an oil-consultancy firm, estimated Chinese oil demand expanded 13% during the first four months, suggesting there was a small build in oil inventories.

J.P. Morgan, however, believes China has been destocking in recent months, citing a Chinese oil-company executive who put the firm's demand growth at 23%.

Carolyn Cui

• reduction [ri´dʌkʃən] n.减少；缩小；降低 (初中英语单词)
• absence [´æbsəns] n.不在，缺席；缺乏 (初中英语单词)
• reading [´ri:diŋ] n.(阅)读；朗读；读物 (初中英语单词)
• economy [i´kɔnəmi] n.经济；机制；组织 (初中英语单词)
• remote [ri´məut] a.遥远的；偏僻的 (初中英语单词)
• cultivate [´kʌltiveit] vt.耕作；培植；培养 (初中英语单词)
• accurate [´ækjurət] a.准确的；精密的 (初中英语单词)
• debate [di´beit] n.&v.讨论，辩论 (初中英语单词)
• waiting [´weitiŋ] n.等候；伺候 (初中英语单词)
• copper [´kɔpə] n.铜 a.铜制的 (初中英语单词)
• running [´rʌniŋ] a.奔跑的；流动的 (初中英语单词)
• domestic [də´mestik] a.家庭的；本国的 (初中英语单词)
• energy [´enədʒi] n.活力，精力；能力 (初中英语单词)
• vision [´viʒən] n.视觉；想象力；幻影 (初中英语单词)
• executive [ig´zekjutiv] a.行政的 n.行政官 (初中英语单词)
• commodity [kə´mɔditi] n.日用品；商品 (高中英语单词)
• consumption [kən´sʌmpʃən] n.消耗；结核病 (高中英语单词)
• tighten [´taitn] v.(使)变(拉)紧 (高中英语单词)
• storage [´stɔ:ridʒ] n.贮存；存储器 (高中英语单词)
• concerned [kən´sə:nd] a.有关的；担心的 (高中英语单词)
• reasoning [´ri:zəniŋ] n.推理，评理 a.推理的 (高中英语单词)
• potential [pə´tenʃəl] n.&a.潜在的；可能的 (高中英语单词)
• nickel [´nikəl] n.镍 vt.把...镀镍 (高中英语单词)
• typical [´tipikəl] a.典型的；象征的 (高中英语单词)
• accurately [´ækjuritli] ad.准确地；精密地 (英语四级单词)
• policy [´pɔlisi] n.政策；权谋；保险单 (英语四级单词)
• primarily [´praimərəli, prai´merəli] ad.首先；主要地 (英语四级单词)
• aluminum [,ælju´miniəm, ,ælə´miniəm] n.铝 (英语四级单词)
• monetary [´mʌnitəri] a.金融的；货币的 (英语六级单词)
• inconsistent [,inkən´sistənt] a.不一致的 (英语六级单词)
• satellite [´sætəlait] n.(人造)卫星；随从 (英语六级单词)
• underlying [,ʌndə´laiiŋ] a.基础的；下层的 (英语六级单词)
• robust [rəu´bʌst] a.强建的；茁壮的 (英语六级单词)