BEIJING/SHANGHAI (Reuters) – China’s December trade data beat expectations, as demand from a stronger US economy helped offset weakness in Europe and Japan while Chinese bargain-shopping in commodities markets put a floor under sliding imports.
But while exports grew faster and imports shrank less than forecast, trade officials warned of more headwinds to come in the first quarter.
Policymakers are trying to steer the world’s second-largest economy through a soft patch as it confronts weak demand and a slowdown in its property market.
Exports in December rose 9.7 per cent from a year earlier in dollar-denominated terms, data from the General Administration of Customs showed on Tuesday, handily beating a Reuters poll by nearly three full percentage points.
Imports dropped by only 2.4 per cent, where analysts’ consensus was for a far steeper decline of 7.4 per cent.
Officials were cautious when discussing how much positive momentum trade will deliver.
“We think the negative factors that crimped trade performance in 2014 will be sustained for a period of time,” said Zheng Yuesheng, a spokesman for China’s customs bureau.
Zheng was referring to factors such as a weak recovery in the world economy, falling foreign direct investment in Chinese manufacturing and rising domestic production costs.
The smaller fall in imports than in November was largely due to a resurgence in commodity purchases, and Zheng noted sliding prices had been a net benefit for the country by reducing import costs. China posted a trade surplus of $49.6 billion for the month, smaller than November’s record $54.5 billion.
China imported 30.37 million tonnes of crude oil in December, or 7.15 million barrels per day (bpd), topping the 7 million bpd mark for the first time, customs data showed, as the world’s largest oil importer took advantage of low global prices to fill its strategic reserves.
It also purchased a record high volume of iron ore.
However, falling commodity prices have proven to be a net negative for Chinese industrial profits, and analysts warned that investors should not read too much into the recovery in imports.