Chinese crude oil imports rose to a seven month high in October, climbing to nearly 42 million tons, according to customs data released on Tuesday and reported by Bloomberg. The increase was led by Iraqi cargoes as shipments from the Gulf recovered, although imports were still 13 percent lower than a year earlier as the impact of the Iran war continued to limit supplies. Reuters, reporting the same customs release, described crude imports as the highest since March.
The rest of the customs detail maps the physical economy behind the headline. Oil product exports rose 15 percent to above 5 million tons, slipping from the previous month, as refiners capitalised on strong global margins while low domestic diesel inventories became a growing concern. Natural gas imports rose 2.4 percent to about 10 million tons as buyers stockpiled ahead of peak winter heating demand, from both LNG shipments and overland supply from Russia, although weaker domestic prices since then are curbing appetite for pricier seaborne cargoes.
Metals told a tighter story. Copper metal imports rose 3.5 percent, not enough to relieve a supply crunch that has pushed the Yangshan port premium to record levels, with concentrate imports dropping 12 percent as smelters cut production. Iron ore imports fell 5.1 percent to a five month low amid rising stockpiles and falling prices, and steel exports dropped below 10 million tons for the first time since April. Coal imports fell 5.5 percent to below 40 million tons for the first time since May, dragged by production controls at top supplier Indonesia.
Agriculture moved the other way. Soybean imports dropped 23 percent to a seven month low, despite US efforts to ship more beans under its trade truce with Beijing, and fertilizer exports fell 26 percent after spiking the previous month when Beijing loosened war related restrictions.
Bloomberg noted that the collapse in crude prices after the US midterm elections could entice more Chinese buyers back into the market, particularly if a resolution of the conflict follows. For now the data show a buyer returning selectively: crude and gas up, the steel chain down, and copper still short.