China’s iron ore, copper and coal imports rise to annual high

China’s commodities purchases broadly turned higher in September as buyers stocked up to meet the usual rise in industrial demand during the autumn months.

Imports of iron ore, copper metal and coal all hit their highest levels this year, while soybeans rose to a four-month best. Decliners month-on-month included crude oil, copper ore and natural gas, although the first two items were still above the levels of the year before.

The relatively robust imports come despite a challenging economic backdrop, which is likely to worsen if the latest escalation in trade tensions with the US results in higher tariffs on Chinese goods. China’s manufacturing sector contracted for a sixth straight month in September, although the decline was tempered by better weather and the seasonal upturn in activity. Measures of construction and services also fell.

Natural gas imports performed poorly last month, dropping 6.8% from August, after pricier seaborne cargoes slumped in the face of rising local production. Coal, by contrast, rose 7.6%, benefiting from domestic output cuts that have lifted prices and made overseas supply more attractive, particularly as utilities stock up for winter.

Crude oil imports fell 4.5%. The international market has relied on Chinese strategic stockpiling to buoy prices, but that effort was undercut in September as some state-owned refineries shut units for seasonal maintenance and smaller outfits were hindered by thinning import quotas.

Copper concentrate imports dropped 6.3% as mine disruptions, most recently at Grasberg in Indonesia, hampered supply of the smelting feedstock. Unwrought copper and products took up the slack, surging 13% as buyers switched to already processed metal.

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