Testifying at a recent Senate hearing, Weiner said the aluminum he purchases for the packaging of the company's beer is being held up in warehouses that are controlled and owned by U.S. bank holding companies.
"These bank holding companies are slowing the load-out of physical aluminum from these warehouses to ensure that they receive increased rent for an extended period of time," he said. MillerCoors has to wait as long as 18 months for the metal or pay a high premium. Weiner believes the practice is keeping aluminum prices higher than they should be in a market where there has been "massive oversupply and record production."
The hearing of the Financial Institutions and Consumer Protection Subcommittee of the Senate Committee on Banking, Housing & Urban Affairs detailed other instances in which large U.S. banks have diversified into commodities-markets operations, stretching the limits of rules designed to separate banking and commerce. The upshot: the high prices and price volatility some commodities have experienced may in part stem from banks' heavier involvement in the storage, transportation and trading of "physical" commodities - as opposed to their participation in the "non-physical" futures and options markets.
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