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China commodity imports surge in March

(Adds data, analyst comment)

April 13 (Reuters) – China’s imports of major commodities rose strongly in March from the year ago, data from the General Administration of Customs showed on Tuesday, as the world’s second-biggest economy marched ahead post-COVID-19.

China’s overall imports surged 38.1% year-over-year in March, the fastest pace in four years, while exports also grew at a robust pace.

Below are comments from analysts on the commodities data.

KEY POINTS:

*Crude oil: March imports were at 49.66 million tonnes, up 21% yoy

*Natural gas: March imports were at 8.73 million tonnes, up 26.1% yoy

*Iron ore: March imports were at 102.11 million tonnes, up 18.9% yoy

*Copper: March imports were at 552,317 tonnes, up 25% yoy

*Soybean: March imports were at 7.77 million tonnes, up 82% yoy

*Meat: March imports were 1.02 million tonnes, up 11.4% yoy

Preliminary table of commodity trade data

Comment on copper

HE TIANYU, CHINA COPPER ANALYST AT CRU GROUP

“The big (jump in) imports in March on a YOY basis is because of the impact of COVID-19 in Q1 2020. In Q1 2021, the continuing impact of COVID-19 led to tensions in international maritime logistics capacity. Capacity constraints eased somewhat in March, so there was some growth from January and February. However, the capacity problem has not yet been fully resolved, so some of the lagging goods will continue to enter China in the future.

“In addition, China’s copper demand is growing at a positive year-on-year rate as the overseas outbreak has not fully recovered and some overseas order demand has shifted to China for production and processing. Imports could keep rising in the next two months, but after April or May, we may not see YOY highs anymore. And 2021 annual imports could not be higher than 2020’s.”

Comment on iron ore

CAI BIYU, ANALYST WITH GF FUTURES

“The increase of China’s iron ore imports was just a return to normal level from a relatively low basis last year when shipments were affected by extreme weather in Australia and Brazil.

“Meanwhile, though steel production curbs in Tangshan city could last for a while, mills in other places are motivated to replenish their stocks on peak seasonal demand. However, restocking demand could send up iron ore prices in the short term but not for the long run.”

Comment on crude oil

CHEN JIYAO, HEAD OF CHINA CLIENT ADVISORY FOR FGE

“Chinese refiners have slowed down their crude purchase (for Q2 arrival) since January 2021, in anticipation of lower crude runs this quarter.

“High crude prices and a backwardated market structure have also dampened crude purchase for stockpiling activities. Imports should pick up in Q3, coinciding with higher refinery runs as maintenance eases.”

LINKS: For details, see the official Customs website (www.customs.gov.cn) BACKGROUND: China is the world’s biggest crude oil importer and top buyer of copper, coal, iron ore and soybeans. (Reporting by Asia Commodities and Energy team; Editing by Muralikumar Anantharaman)


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