China’s commodities imports rise as seasonal demand revives

[BEIJING] China’s commodities imports broadly rose in August as buyers geared up for the increase in industrial activity that usually accompanies the end of summer.

Crude oil, iron ore, copper and soybeans all posted year-on-year gains, while fuels for power generation showed signs of recovery, according to customs data on Monday (Sep 8).

Still, the backdrop to Chinese demand for raw materials remains shaky, with recent data pointing to significant challenges from overcapacity and deflation to frictions with trade partners, most notably the US. Various economic gauges slowed across the board in July, while factory activity remained stuck in contraction in August. Policymakers have responded by signalling their intent to restrain excessive competition in key industries, including oil processing and steelmaking.

Crude imports of 49.5 million tonnes were slightly above last year. China has stockpiled oil this year to take advantage of lower international prices. With maintenance season over, refiners took even more cargoes in August, although the outlook for fuel markets remains heavily clouded by the ongoing electrification of the economy.

Iron ore imports returned above 105 million tonnes for only the second time this year. Chinese steel production has fallen in recent months, most recently to ensure clear skies for last week’s military parade in Beijing, which has raised prices and margins.

That’s translated into healthier profits at mills and support for their feedstock purchases. However, if the government succeeds in delivering sustained cuts to output, it will end up reducing iron ore demand and undermining prices and imports.

Copper boost

Imports of copper concentrate rose to 2.8 million tonnes, their second-highest level ever, after a boost to cargoes from Indonesia. Appetite for copper has been lifted by both China’s smelter expansion and green demand for the metal. Meanwhile, shipments of unwrought copper and products fell to a six-month low of 425,000 tonnes, although they were still slightly above last year.

Coal cargoes rose to their highest this year, although they were still below the level seen in 2024. Imports have been hamstrung by record domestic production, sagging industrial demand, and the rapid penetration of renewables. Similar dynamics have affected natural gas imports, although they also rose in August to an 11-month high.

Agricultural imports firmed. Soybeans hits a three-month high as crushers continued to stock up on Brazilian supplies to hedge against a drop-off in purchases from the US. Edible oils surged to their strongest since January 2024, while meat imports stayed above 500,000 tonnes for a sixth straight month. BLOOMBERG