BEIJING (Reuters) - China’s commodity imports roared back in November as supply worries due to winter factory cuts stoked buying for copper, while traders scooped up iron ore on expectations of resurgent demand from steel mills next year.
Crude oil imports hit their second-highest ever and natural gas shipments jumped to a record as buying picked up in all areas, rebounding from a slowdown in October due to a week-long holiday and ahead of the Communist Party Congress.
The data underscored the resilience of China’s heavy industry, even as many steel mills, aluminum producers and other manufacturers in the world’s top consumer of industrial raw materials prepared for deep production cuts as part of Beijing’s blitz on winter smog.
Unwrought copper arrivals hit their highest since December 2016, concentrate and ore shipments were their highest on record and iron ore imports were among the highest ever.
“All but coal also recorded strong year-on-year gains, suggesting this year’s seasonal downturn has been short. This should dismiss any fears that last month’s fall was indicative of a permanent trend,” said ANZ analysts in a note.
Overall trade data showed China’s exports and imports unexpectedly accelerated last month even as concerns linger about the impact of the government’s crackdown on financial risks and polluting factories.
Natural gas imports were driven by Beijing’s ambitious push to heat millions of northern homes by the clean fuel this winter, while crude oil imports soared as refineries churned out more fuel to cash in on surging diesel and gasoline prices.
Fears about the impact of winter production restrictions at the world’s top copper consumer drove up shipments of overseas metal, while analysts said a Shanghai premium over London prices also encouraged buying as exchange inventories fell.
The data suggests trade may remain robust as cuts this winter spur the world’s second-largest economy to source more product from abroad as domestic output slides.
Some are preparing for brisk business once factories reopen in March.
Iron traders started stockpiling product as prices fell last month in anticipation of stronger demand after the winter months, traders and analysts said.
“Steel mills have been restocking more iron ore since October as prices hit as low as $50 (a tonne),” said Yu Yang, an analyst with Shenyin & Wanguo Futures in Shanghai.
Reporting by Josephine Mason and Tom Daly in BEIJING, Melanie Burton in MELBOURNE, Ruby Lian in SHANGHAI and Manolo Serapio in MANILA; editing by Richard Pullin