zaterdag 13 oktober 2012

Chinese Iron Ore Imports Make New High

If you are concerned about the Chinese economy, you shouldn't. Chinese exports for the month of September came in at $186 billion, a 9.9% increase year over year.

We did have a little dip end 2008 where exports fell to about $65 billion, but since 2009, the Chinese kept growing their exports as you can see on Chart 1.

Chart 1: Chinese Exports
As Zerohedge's chart points out, exports and imports are mostly equal. If exports move up, imports will move up too. Mostly exports are higher than imports as China has a trade surplus.

The thing to consider is that if exports go up, imports will go up and as a result, commodities will go up in price (Chart 2). We had 3 months of consecutive drops in imports, but September has made an end to that. In September, China imported a record amount of iron ore, the highest since January 2011: 65 million tonnes. Also copper imports jumped to a 4 month high.
Chart 2: Chinese Exports - Imports
On Chart 3 you can see that 65 million tonnes of iron ore imports isn't that much compared to the previous months, but it's a start. China has started a 1 trillion yuan stimulus and we will certainly see the effects of this in the coming months.
Chart 3: China Iron Ore Imports
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