September was another weak month for China’s trade – exports fell at a faster pace than forecast last month while imports fell for a fifth straight month.
September exports fell 3.2% from a year earlier, the biggest fall since February, Chinese customs data showed yesterday. Forecasters had expected a 3% dip in a Reuters poll after August’s 1% fall.
September imports fell a much steeper 8.5% after August’s 5.6% fall and was the biggest fall since May. Analysts had forecast a drop of 5.2%.
Economists say the weak figures point to further weakness in the economy thanks in part to the Trump-driven trade war between China and the US.
While Friday’s announcement of a partial deal helped send markets higher yesterday and last night, the fact there are up to five weeks of delay before the new deal can be formalised, and another tariff rise in mid-December, suggests the trade tensions are not going to ease any time soon.
So more weak monthly trade data can be expected – probably past the Chinese New Year in late January and running into early February.
China reported a trade surplus of $US39.65 billion last month, compared with a $US34.84 billion surplus in August and a forecast of $US33.3 billion.
And yet that was a bit misleading with imports of key commodities such as iron ore, copper, oil, and LNG rising last month – iron ore especially and oil.
China’s trade surplus with the United States eased to $US25.88 billion in September, from August’s $US26.96 billion.
China’s exports to the United States fell 10.7% from a year earlier in dollar terms in January-September, while US imports slumped 26.4% during that period.
Two notable factoids stood oil – the impact of African Swine Fever saw China’s pork imports jump 76% in September from the same month last year while beef imports came close to a monthly record.
September imports totalled 166,000 tonnes, according to Reuters, and slightly ahead of August’s 163,000 tonnes.
Pork imports for the first eight months of the year were 1.33 million tonnes, up 43.6% from the same period a year earlier, according to the General Administration of Customs in a statement.
The size of China’s pig herd has fallen 37%, according to official data and that has helped push food prices, led by the cost of pork (up around 80%), to their highest level for years. An update on Chinese consumer and producer price inflation will be out later today.
The deadly African swine fever has reduced the world’s top pig herd by almost 40%, according to official data, after spreading unchecked throughout the country and leaving many farmers unwilling to replenish their farms.
Reuters figures say that beef imports are up 50% in the past year at 149600 tonnes in September, close to the record monthly total of 152,213 tonnes in July
For the first nine months, beef imports came to 1.13 million tonnes, up a huge 53.4% from the first 9 months of 2018.
And there was another fascinating bit of trade data – September’s figures showed the country’s rare earth exports fell 17.9% from August.
China is the world’s largest rare earth exporter and there are continuing fears it will cut back its exports to retaliate against the US in the trade war.
The country sold 3,571 tonnes of rare earths in September, figures from the General Administration of Customs of China showed.
This was down from 4,352 tonnes in August and 27.9% lower than the 4,950 tonnes shipped in September 2018.
