THG, one of the world's top nickel producers, faced massive losses on its short positions after prices soared to more than $100,000 per tonne last year and trading was halted.
People familiar with the matter told Bloomberg Guangda was planning a shift in his production mix, looking to profit from an unusually large premium in the price of refined nickel metal.
"Tsingshan is holding early talks with a number of copper producers, including Yanggu Xiangguang Copper Co, a major copper smelter that was idled once last year amid financial difficulties," the report said, citing people who asked not to be identified discussing private information.
The plan to use copper plants to process nickel is novel, but the process has already been applied successfully during a trial at a smaller factory in central China, the report said.
If successful, Tsingshan's plan, together with similar moves by its peers, could double Chinese refined nickel production this year, from about 180,000 tons in 2022 -- adding roughly a fifth to global refined output, report added.
Additionally, the world's largest stainless steel and nickel producer is constructing new nickel refineries in China and Indonesia, the report added.
(Reporting by Ashitha Shivaprasad in Bengaluru; Editing by Nivedita Bhattacharjee)
