Commodity shipments should continue to benefit from an uptick in Chinese demand, according to a report from Westpac and the Australian Department of Industry Innovation and Science, as the Chinese economy stabilises.
“The Chinese economy lost momentum through 2015 and Q1 2016,” said the latest edition of the Chinese Resources Quarterly (CRQ). “However, since then, read GDP growth has stabilised at 6.7%. Many questions remain regarding the outlook for China; but, at least for not, solid growth continues.”
Imports of key commodities have seen renewed strength this year. Iron ore imports hit a high of 269.1 million t in 3Q16, while metallurgical coal imports were 16.5 million tin 3Q16 – the highest level since 4Q14 and up from lows of 11.4 million t in 1Q16.
According to the CQR: “China’s imports of iron ore increased 8%yr in Q3, with imports from Australia up 7% [year on year], and imports from Brazil up 12% [year on year]. Imports from the rest of the world also increased, up 15% [year on year].”
Thermal coal dropped back to just 20.64 million tin 3Q16, following a bounce in the previous quarter. 2Q16 imports were 43.96 million t, the highest since 4Q14.