China May Trade Surplus Smaller than Expected



China's trade surplus narrowed sharply to USD 24.92 billion in May 2018 from USD 40.51 billion in the same month a year earlier, and came in well below market consensus of USD 31.9 billion. Imports jumped 26 percent to a record high while exports rose at a softer 12.6 percent.

Imports rose 26 percent from a year earlier to an all-time high of USD 187.95 billion in May, after a 21.5 percent rise in a month earlier and easily beating market expectations of 18.7 percent. Imports of commodities continued to lead the way in May, with shipments of copper, iron ore and soybeans all rising from the previous month. China's unwrought copper imports rose to a 17-month high of 475,000 tonnes from the previous month's 440,000 tonnes, and 21.8 percent above the previous year's figure. It was the the highest May figure for at least a decade. Iron ore imports rose 13.5 percent from the previous month to 94.14 million tonnes, and were 2.9 percent above the previous year's 91.52 million tonnes. Soybean imports rose to 9.69 million tones in May from last month's 6.9 million tonnes. Also, they were up 1 percent from last year. On the other hand, China's crude oil imports fell from record highs hit the month before to 39.05 million tonnes in May, or 9.2 million barrels per day (bpd). It compared with 9.6 million bpd in April and 8.76 million bpd a year earlier.

Exports increased at a slower 12.6 percent to USD 212.87 billion, following a revised 12.7 percent rise in the preceding month and compared to market forecasts of a 10 percent gain. The country's unwrought aluminium and aluminium product exports came in at 485,000 tonnes in May, the highest since December 2014. Shipments were up 7.5 percent from 451,000 tonnes in April and up 12.8 percent from 430,000 tonnes a year ago. In addition, sales of steel products rose 5 percent to 6.88 million tonnes in May from 6.48 million tonnes in the previous period, but down 1.4 percent from a year earlier. It was the highest value since July 2017.

The trade surplus with the US, China's largest export market, widened to USD 24.58 billion in May from USD 22.15 billion in April, as exports to the country went up 11.6 percent to USD 39.3 billion and imports grew 11.4 percent to USD 14.7 billion. Also, the trade surplus with the EU was USD 9.7 billion, with exports rising by 8.5 percent and imports by 18.3 percent; and that with ASEAN countries was USD 6.5 billion, as exports advanced 17.6 percent and imports 20.5 percent. Meanwhile, the biggest trade deficit was recorded with Taiwan (USD 11.3 billion, with exports increasing 11.7 percent and imports 31.6 percent), followed by South Korea (USD 8.2 billion, with exports increasing 11.4 percent and imports 31.8 percent), Australia (USD 5.5 billion, with exports increasing 18.5 percent and imports 22.4 percent) and Japan (USD 3.8 billion, with exports increasing 10.2 and imports 22.5 percent). 

For January-May, China's trade surplus narrowed to USD 102.81 billion from USD 141.90 billion in the same period 2017. The five-month trade surplus with the US surged 12.9 percent to USD 104.85 billion.

In yuan-denominated terms, the trade surplus stood at CNY 156.51 billion in May, as imports jumped 15.6 percent and exports advanced 3.2 percent. Over the January-May period, the trade surplus shrank 31 percent to CNY 649.8 billion, with exports increasing by 5.5 percent and imports by 12.6 percent.

China May Trade Surplus Smaller than Expected


Rida | rida@tradingeconomics.com
6/8/2018 7:05:43 AM