Business Day reported that although reports in the Australian press suggesting that China is planning to buy 9% stake in BHP Billiton have been denied by the company, but can not be ignored.

It said that the rumor has largely been discounted because it’s been viewed through the lens of the BHP Rio Tinto takeover battle but makes a lot of sense if the strategy is not related to the takeover battle, but is simply based on an intention to hedge against higher commodity prices.

Rumors stemmed from a report in The Australian today which cited an anonymous source in Beijing as saying that China is in the early stages of planning to acquire over a 9% stake in BHP on order to block a merger with Rio Tinto.