Falling world prices helped boost Chinese imports of a wide range of commodities and some exports of key finished products in 2015, despite overall weakness in both imports and exports.
In fact, despite the slowing pace of economic growth and weakening demand, it was record year for imports of many commodities into China (and in December for a key few, such as oil and iron ore), despite an overall fall in imports for the month and the year.
The country’s trade surplus widened to $US60.1 billion in December from $54.1 billion in November. For the year, weak Chinese exports and even weaker imports saw a record annual trade surplus of $US594.5 billion, compared with $382.5 billion in 2014.
Full-year exports fell 2.8% and imports fell dropped 14.1%, driven by massive falls in the value of key commodities like oil, coal, copper and iron ore.
According to China’s General Administration of Customs, exports fell 1.4% in December in dollar terms from a year earlier, after a drop of 6.8% in November In yuan terms, exports rose last month. Imports last month fell 7.6% from a year earlier, compared with an 8.7% decline in November.
The country took advantage of the slide in commodity prices and some analysts reckon the savings over 2015 were $US160 billion on the cost of imports of iron ore, copper, oil and coal, compared with 2014. Price falls for other commodities, such as metals, soybeans and foodstuffs would have produced billions more in savings.
The savings came from not sluggish demand in China – that was certainly slower than in 2015, but from the high levels of oversupply in many commodities – from iron ore, to coal, especially oil, copper, metals, soybeans and more.
Imports of oil, iron ore and soybeans all hit record volumes, while copper was steady, Chinese customs data showed yesterday Coal was the exception, with imports plunging as a domestic glut slashed local prices and demand fell as the government moved to close old power plants, steel mills and other users to try and reduce pollution levels.
While its crude oil imports in 2015 hit a record 6.71 million barrels per day (bpd), its fuel exports also hit an all-time high of 693,300 bpd as refiners had to look abroad to clinch sales. It was a similar story in the struggling steel sector.
Iron ore imports hit a record monthly high in December of more than million tonnes, and a year high as world prices sagged to multi-year lows ($US38.30 a tonne was the 12 year low reached on December 11 last year), China’s steel exports surged nearly 20 percent over the year as producers diverted product from depressed local economy onto the world market.
Iron ore imports jumped to 96.27 million tonnes, up 17% from November and 10.8% from December, 2014. Full-year imports rose 2.2% to reach 952.72 million tonnes, also an all-time high, but a sharp slow down from the 13.8% rise (to just over 932 million tonnes) seen in 2014.
Steel exports rose 11% in December to 10.66 million tonnes from the previous month, the second highest ever, according to the customs data. For the year, exports jumped 20% to a record 112.4 million tonnes, an all-time high.
Crude oil imports rose 9% last year as prices slumped more than 30%, thanks to strategic stockpiling and a relaxation of controls on crude imports and refined product exports (such as diesel and jet fuel).
Imports of copper anode, refined copper, alloys and semi-finished copper products eased 0.3% to 4.81 million tonnes in 2015, from the record 4.83 million tonnes in 2014. In December of 2015, imports jumped 15.2% from November to 530,000 tonnes, the second-highest monthly total after 536,000 tonnes in January 2014.
But imports of copper ore and concentrates arose 12.6% to a record 13.29 million tonnes in 2015, according to the customs data. And the total dollar value of copper imports last year fell 18.4%.
Imports of raw material copper ores and concentrates reached a record 1.48 million tonnes in December 2015, up 2.8% percent from November.
China imported 33.19 million tonnes of oil in December, up 9.3% higher from December 2014, and more than 20% higher than the 27.3 million tonnes in November.
China’s imports of refined oil products dropped 11% on year to 2.84 million tonnes in December, and were down 0.3% to 29.90 million tonnes for 2015.
China also exported 4.32 million tonnes of oil products in December, a 53% year on-year surge. In 2015, China boosted exports 22% to 36.15 million over the year.
Soybean imports jumped more than 14% percent in 2015 to 81.69 million tonnes in 2015, reflecting strong demand for soymeal, a key ingredient in animal feed production.
Coal also looks set for another sharp fall, hurt by state efforts to cut pollution and a slump in domestic prices that has eroded the price advantage of imported coal.
China’s coal imports slumped 30% from 2014 to 204.1 million tonnes last year (they fell 35% in December alone).
China’s raw coal output is expected to fall 4.2% in 2016 to 3.6 billion tonnes, down from an estimated 3.76 billion tonnes in 2015, according to the China Academy of Sciences.
