A Hong Kong court has ordered a subsidiary of SDIC Commodities Co. to undergo liquidation, marking another setback for the metals trader amid growing regulatory pressure from Beijing.

The ruling adds to mounting financial troubles for the state-backed Chinese commodities firm as authorities intensify their scrutiny of the sector. The specific subsidiary targeted in the liquidation order was not named in initial reports.

This development reflects broader challenges facing Chinese commodities traders as the government tightens oversight on financial practices and risk management within the industry. SDIC Commodities, backed by state-owned SDIC Holdings, has been navigating difficult market conditions alongside increased regulatory demands.

The liquidation order underscores the Hong Kong court's willingness to take decisive action against financial entities facing insolvency, while highlighting the interconnected risks between Chinese state-backed enterprises and international financial centers.