LAUNCESTON, (Australia): China’s imports of major commodities softened in March, a trend that is likely to extend in coming months as the world’s biggest buyer of resources deals with the economic pain of maintaining its zero-COVID policy.
Imports of crude oil, natural gas, iron ore, coal and copper were all weaker in March when compared to the same month last year, according to official customs data released on Wednesday.
For the first quarter only imports of unwrought copper saw an increase over the same period in 2021, underscoring what has been a soft start to the year for commodity demand in the world’s second-biggest economy. China’s commercial capital Shanghai has locked down its 25 million residents for almost three weeks as authorities attempt to contain the country’s biggest outbreak of COVID-19 since the coronavirus was first identified in the city of Wuhan in late 2019.
The restrictions in Shanghai, and in other Chinese cities, are starting to ripple through global supply chains, with some factories being forced to close and delays increasing at ports. It’s likely that the determination of the authorities to stamp out COVID-19 will lead to ongoing lockdowns and economic disruption in coming weeks, and this will eventually feed into China’s commodity imports. Crude oil imports were 10.06 million barrels per day (bpd) in March, down 14% from March last year and also lower than the 10.53 million bpd average for January and February.
China combines trade data for January and February, but it does appear that March’s crude imports were slightly higher than those for February, which Refinitiv Oil Research pegged at 9.51 million bpd.
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