China’s commodities imports fell in October

by BLOOMBERG/ pic by BLOOMBERG

BEIJING • China’s purchases of key commodities fell in October from the prior month, mainly because of seasonal factors including an extended holiday at the start of the month in the world’s biggest buyer of raw materials.

While the nation’s broader imports couldn’t hold September’s heady pace, slumping to below-consensus growth of 4.7%, “a second straight monthly expansion suggests a continuous rebound in domestic demand”, according to Bloomberg Economics.

Among major commodities, crude imports fell to a six-month low of 42.6 million tonnes as private refiners ran low on quotas and state firms trimmed purchases due to maintenance, according to customs data on Saturday.

Still, the tally for the year is likely to increase by 10% from 2019 to more than 550 million tonnes as the rebounding economy drives demand, a senior executive at China Petrochemical Corp, owner of the nation’s biggest refiner, said yesterday at an energy conference in Shanghai.

Coal purchases in October slumped to 13.7 million tonnes, a low for the year, as buyers close in on an unofficial annual cap of around 300 million tonnes. Year-to-date (YTD) shipments of 253 million tonnes suggest more room for imports in the last two months, although a ban on coal from major supplier Australia means that it’ll be other origins that benefit.

Natural gas imports fell to a three-month low of 7.5 million tonnes in a lull before peak winter demand.

Iron-ore shipments topped 100 million tonnes for a fifth month, with the YTD total running 11% ahead of 2019 as China turned to its usual infrastructure splurge to rejuvenate the economy. A slowdown is expected in subsequent months as winter production curbs cut demand from the steel industry.

Copper purchases fell to a five-month low — though they’re still up more than 40% over the first 10 months — while ore purchases fell from September’s 2020 high as the seasonal demand lull started to take hold.

Soybean imports dropped to 8.7 million tonnes, a six-month low, as cargoes from Brazil, the country’s largest supplier, dwindled. But the total was far higher than last year due to the recovery in the domestic hog herd after African swine fever and expanded US purchases to fulfil China’s trade deal obligations.

And while meat and offal imports also fell in October, the near 70% rise through the year so far to over eight million tonnes is a record as China is forced to import more protein to cover its pork shortfall. — Bloomberg