Event: according to the statistics of the General Administration of customs, priced in RMB, China’s exports increased by 16.6% year-on-year in November, imports increased by 26% year-on-year, and the trade surplus in November was 460.68 billion yuan. In dollar terms, China’s exports increased by 22.0% and imports by 31.7% year-on-year in November. The trade surplus in November was US $71.72 billion.
In November, the export growth rate exceeded market expectations, and the prices of major export commodities rose sharply year-on-year. Priced in RMB, China’s total exports in November were 2088.55 billion yuan, a year-on-year increase of 16.6%, an increase of 33.4% over the same period in 2019, exceeding market expectations. On the demand side, JPMorgan’s global manufacturing PMI, American ism manufacturing PMI, Japanese manufacturing PMI and euro zone manufacturing PMI recorded 54.2%, 61.1%, 54.5% and 58.4% respectively in November. The prosperity level has increased and are all in the boom range. The repeated overseas epidemic has driven the prices of China’s main export commodities to rise sharply year-on-year. In terms of major export categories, from January to November, China’s cumulative export amount of mechanical and electrical products increased by 21.2% year-on-year, and the cumulative export amount of labor-intensive products increased by 10.2% year-on-year, Among them, electromechanical products such as automobiles (108.4%) and household appliances (16.3%) grew rapidly; labor-intensive products such as clothing and clothing accessories (16.1%) and plastic products (21.7%) performed prominently. In addition, the cumulative export amount of steel and fertilizer from January to November increased by 26.7% and 19.1% year-on-year.
In November, the import growth rebounded sharply, and the production and operation of Chinese enterprises resumed. Priced in RMB, China’s total imports in November were 1627.87 billion yuan, a year-on-year increase of 26%, an increase of 25% over the same period in 2019, better than market expectations. Affected by a series of favorable policies such as strengthening energy supply guarantee and stabilizing market prices, the production of Chinese enterprises recovered steadily. In November, China’s manufacturing PMI recorded 50.1%, the production index rose 3.6 percentage points to 52.0% compared with the previous month, and the import index recorded 48.1% in November, up 0.6 percentage points compared with the previous month. China’s production stabilized and the demand side improved, resulting in a rebound in imports in November. From the perspective of main import categories, the import volume of iron ore, crude oil, soybeans and other commodities decreased in price in the first November, while the import volume and price of coal and natural gas increased simultaneously. The import of iron ore decreased by 3.2%, and the average price per ton was 1099.3 yuan, up 53.1%; Crude oil decreased by 7.3%, with an average price of 3191.1 yuan per ton, up 39.5%. In addition, driven by China’s coal supply and price stabilization policy, the import quantity and amount of coal and lignite increased significantly in November compared with October.
From January to November, the import and export to the four major trading partners continued to grow year-on-year, and the external demand remained stable. In RMB terms, from January to November, China’s exports to the EU, the United States, ASEAN and Japan increased by 23.9%, 19.2%, 18.9% and 8.8% respectively year-on-year. Compared with the cumulative year-on-year growth from January to October, it increased by 0.5, – 2.6, – 0.2 and – 0.2 percentage points respectively. Overall, China’s exports to major economies remained stable from January to November. Denominated in RMB, the trade surplus in November was 460.68 billion yuan, down from the previous month, and the foreign trade situation decreased slightly.
Overall, the import and export in November was better than the market expectation and maintained a resilient growth. In terms of domestic demand, affected by the easing of the shortage of power supply and the obvious drop in the prices of some raw materials, the production and operation of Chinese enterprises gradually stabilized in November, and both ends of production and demand improved. It is necessary to pay attention to the changes of policies such as ensuring supply and stabilizing prices in the later period. In terms of external demand, the overseas supply side has gradually recovered, the end consumer demand remains strong, and the situation in developed countries has generally improved. Attention should be paid to the overseas epidemic and economic recovery. Looking forward to the first half of 2022, the global economic recovery and the progress of supply chain repair are still important variables affecting China’s export prosperity. We believe that in the first half of 2022, the year-on-year growth rate of China’s exports will fall back from the high level. This is mainly due to the general improvement of global vaccination rate, the continuous maturity of epidemic prevention measures in various countries, the accelerated pace of enterprise resumption of work and production, and the weakening of China’s export substitution logic. In addition, the slowing economic recovery has weakened demand. However, recently, China has continued to promote multilateral trade relations, establish a negative list, and reduce import tariffs and institutional costs, which will help stabilize the overall stability of foreign trade.
Risk tips: repeated overseas epidemics, unexpected changes in Chinese policies, and price fluctuations of bulk commodities.
