China showed a record monthly trade surplus in October as exports rose despite global supply chain disruption.
Exports rose 27.1% in dollar terms last month from a year earlier to $ 300.2 billion, General Customs Administration data showed Sunday. It was the 13th consecutive month of double-digit growth, surpassing economists’ expectations of a 22.8% profit. Imports increased by 20.6%, leaving a trade surplus of $ 84.54 billion.
China’s trade growth remained well above pre-pandemic levels throughout the year. Its exports to October have already surpassed the whole of 2020.
The strong trading performance provides support to a Chinese economy that has slowed sharply in recent months due to weak domestic demand caused by a downturn in property, electricity shortages that slowed industrial output, and weak consumer spending exacerbated by sporadic outbreaks of coronavirus .
China’s coal imports nearly doubled in October from a year earlier when Beijing struggled to cope with power outages caused by a shortage of commodity and rising demand for electricity, especially from export-oriented manufacturers.
Imports of natural gas, an alternative to electricity to heat homes, rose by 22% in the first 10 months of the year.
World trade is at record levels this year as economies around the world recover from virus-induced restrictions in 2020. This has put supply chains in many countries under pressure due to shortages of containers and ships as well as capacity at ports, including managers supplying goods to retailers.
The outlook for the supply chain crisis may improve, as predicted by declining shipping costs.
China’s exports to the European Union and the US grew the fastest this year among its major trading partners, customs data showed.
The country’s trade surplus with the US, a source of trade tensions between the world’s two largest economies, rose in the 10 months to October to 2.08 trillion yuan ($ 325 billion) from 1.75 trillion yuan a year earlier, partly because Chinese imports of U.S. soybeans have been slowing down due to weather-related issues in recent months.
Machinery and electrical products accounted for nearly 60% of Chinese exports by value this year, the customs administration said.
Labor-intensive products such as clothing and plastic products accounted for another 18%. Goods such as household appliances, lighting and furniture showed the fastest export growth in October, analysts at Goldman Sachs Group Inc. said in a note.
China is the world’s largest source of demand for most commodities because of its industry and construction-heavy economy.
Demand for construction-related goods has slowed this year due to the country’s real estate market downturn, with iron ore imports declining in volume terms in October.
Dollar inflows supported China’s currency this year, contributing to the government’s foreign exchange reserves, which rose to $ 3.22 trillion at the end of October, according to the People’s Bank of China.
The dollar provides China with an important cushion against any future shocks in the world economy, even as individual companies such as China Evergrande Group struggle to repay their debt.
The country’s strong export momentum will last for at least the next few months, according to a Bloomberg Economics analysis. Demand for Chinese products could slow as consumers in developed economies continue to move away from goods to service consumption, with countries in South and Southeast Asia resuming factory production following a pandemic-related shutdown.
The government has warned in recent days against “downward pressure” on the economy and promises measures to boost domestic demand, including more supportive policies for small and medium-sized companies.
It promised not to use the real estate market to provide temporary stimulus, and the central bank remained conservative and stuck to making short-term loans to keep interbank liquidity stable. Bank reserve requirements have remained unchanged since July and policy interest rates have been stable since last year.