Chinese exports to US plunge as tariffs bite
China's
export growth slowed to a three-month low in May as US
tariffs
slammed shipments, while factory-gate deflation deepened to its worst level in two years, heaping pressure on the world's second-largest economy on both the domestic and external fronts.
US President
Donald Trump's
global trade war and the swings in China-US trade ties have in the past two months sent Chinese exporters, along with their business partners across the Pacific, on a roller-coaster ride and hobbled world growth.
Underscoring the US tariff impact on shipments, customs data showed that China's exports to the US plunged 34.5 per cent year-on-year in May in value terms, the sharpest drop since February 2020, when the outbreak of the Covid-19 pandemic upended global trade.
Total exports from the Asian economic giant expanded 4.8 per cent year-on-year in value terms last month, slowing from the 8.1 per cent jump in April and missing the 5 per cent growth expected in a Reuters poll, customs data showed on Monday, despite a lowering of US tariffs on Chinese goods which had taken effect in early April.
READ MORE
'It's likely that the May data continued to be weighed down by the peak tariff period,' said Lynn Song, chief economist for Greater China at ING.
Song said there was still front-loading of shipments due to the tariff risks, while acceleration of sales to regions other than the United States helped to underpin China's exports.
Imports dropped 3.4 per cent year-on-year, deepening from the 0.2 per cent decline in April and worse than the 0.9 per cent downturn expected in the Reuters poll.
Exports had surged 12.4 per cent year-on-year and 8.1 per cent in March and April, respectively, as factories rushed shipments to the US and other overseas manufacturers to avoid Trump's hefty levies on China and the rest of the world.
While exporters in China found some respite in May as Beijing and Washington agreed to suspend most of their levies for 90 days, tensions between the world's two largest economies remain high and negotiations are under way over issues ranging from China's rare earths controls to Taiwan.
Trade representatives from China and the US are meeting in London on Monday to resume talks after a phone call between their top leaders on Thursday.
China's imports from the US also lost further ground, dropping 18.1 per cent from a 13.8 per cent slide in April.
Zichun Huang, economist at Capital Economics, expects the slowdown in exports growth to 'partially reverse this month, as it reflects the drop in US orders before the trade truce,' but cautions that shipments will be knocked again by year-end due to elevated tariff levels.
China's exports of rare earths jumped sharply in May despite export restrictions on certain types of rare earth products causing plant closures across the global auto supply chain.
The latest figures do not distinguish between the 17 rare earth elements and related products, some of which are not subject to restrictions. A clearer picture of the impact of the curbs on exports will only be available when more detailed data is released on June 20.
China's May trade surplus came in at $103.22 billion (€90 billion), up from the $96.18 billion the previous month.
Other data, also released on Monday, showed China's imports of crude oil, coal, and iron ore dropped last month, underlining the fragility of domestic demand at a time of rising external headwinds.
Beijing in May rolled out a series of monetary stimulus measures, including cuts to benchmark lending rates and a low-cost loan program, aimed at cushioning the trade war's blow to the economy. – Reuters
(c) Copyright Thomson Reuters 2025
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Irish Times
8 hours ago
- Irish Times
Chinese exports to US plunge as tariffs bite
China's export growth slowed to a three-month low in May as US tariffs slammed shipments, while factory-gate deflation deepened to its worst level in two years, heaping pressure on the world's second-largest economy on both the domestic and external fronts. US President Donald Trump's global trade war and the swings in China-US trade ties have in the past two months sent Chinese exporters, along with their business partners across the Pacific, on a roller-coaster ride and hobbled world growth. Underscoring the US tariff impact on shipments, customs data showed that China's exports to the US plunged 34.5 per cent year-on-year in May in value terms, the sharpest drop since February 2020, when the outbreak of the Covid-19 pandemic upended global trade. Total exports from the Asian economic giant expanded 4.8 per cent year-on-year in value terms last month, slowing from the 8.1 per cent jump in April and missing the 5 per cent growth expected in a Reuters poll, customs data showed on Monday, despite a lowering of US tariffs on Chinese goods which had taken effect in early April. READ MORE 'It's likely that the May data continued to be weighed down by the peak tariff period,' said Lynn Song, chief economist for Greater China at ING. Song said there was still front-loading of shipments due to the tariff risks, while acceleration of sales to regions other than the United States helped to underpin China's exports. Imports dropped 3.4 per cent year-on-year, deepening from the 0.2 per cent decline in April and worse than the 0.9 per cent downturn expected in the Reuters poll. Exports had surged 12.4 per cent year-on-year and 8.1 per cent in March and April, respectively, as factories rushed shipments to the US and other overseas manufacturers to avoid Trump's hefty levies on China and the rest of the world. While exporters in China found some respite in May as Beijing and Washington agreed to suspend most of their levies for 90 days, tensions between the world's two largest economies remain high and negotiations are under way over issues ranging from China's rare earths controls to Taiwan. Trade representatives from China and the US are meeting in London on Monday to resume talks after a phone call between their top leaders on Thursday. China's imports from the US also lost further ground, dropping 18.1 per cent from a 13.8 per cent slide in April. Zichun Huang, economist at Capital Economics, expects the slowdown in exports growth to 'partially reverse this month, as it reflects the drop in US orders before the trade truce,' but cautions that shipments will be knocked again by year-end due to elevated tariff levels. China's exports of rare earths jumped sharply in May despite export restrictions on certain types of rare earth products causing plant closures across the global auto supply chain. The latest figures do not distinguish between the 17 rare earth elements and related products, some of which are not subject to restrictions. A clearer picture of the impact of the curbs on exports will only be available when more detailed data is released on June 20. China's May trade surplus came in at $103.22 billion (€90 billion), up from the $96.18 billion the previous month. Other data, also released on Monday, showed China's imports of crude oil, coal, and iron ore dropped last month, underlining the fragility of domestic demand at a time of rising external headwinds. Beijing in May rolled out a series of monetary stimulus measures, including cuts to benchmark lending rates and a low-cost loan program, aimed at cushioning the trade war's blow to the economy. – Reuters (c) Copyright Thomson Reuters 2025
Irish Times
8 hours ago
- Irish Times
Harvard in talks with universities to host students hit by Trump visa clampdown
Harvard has been in talks with leading US and international universities to temporarily house its foreign students facing bans under US president Donald Trump 's clampdown on the college. Leaders from the University of Chicago and the London Business School are among those who have held discussions on accommodating students accepted for the coming academic year at Harvard, but who are now at risk of being denied visas, according to academics at the institutions. Other US universities are examining ways to help their own current and incoming foreign students, including relocating them to campuses outside the country. The Trump administration has banned Harvard from accepting foreign students as part of its broader campaign against what it claims is liberal bias and anti-Semitism on American campuses. A judge temporarily froze the order last week, delaying Mr Trump's actions. READ MORE The administration has suspended the review of all visa applications from prospective students seeking to study anywhere in the country as it steps up background checks, including going through social media. It has also revoked visas and detained foreign students who it claims have been involved in protests, mainly against Israel over its war with Hamas in Gaza. The campaign risks cutting funding for institutions that have grown reliant on fee income from the more than 1.1 million foreign citizens studying in the US. The majority of these students are from China and India. Foreign students are estimated to generate economic benefits of $45 billion (€39 billion) a year, according to the US department of commerce. Nafsa, a network of universities and individuals engaged in international education, criticised 'an unacceptable assault on an already thorough screening and monitoring process [which] creates a climate of uncertainty and fear'. [ Trump v Harvard: University faces existential battle against opponent that would have once been unimaginable Opens in new window ] Amit Sevak, head of ETS, which runs the largest English language test for foreign students applying for universities in the US, said there had been a double-digit drop in the number of applications for the tests. 'What's happening right now with the fall semester just around the corner is that some international students may withdraw, delay or switch to applications elsewhere,' he said. 'The bigger implication will be in 2026.' Harvard launched a fresh legal effort last week to block Mr Trump's latest moves to prevent it accepting international students. 'Contingency plans are being developed to ensure that international students and scholars can continue to pursue their work at Harvard this summer and through the coming academic year,' said Alan Garber, Harvard's president. Mr Trump has focused his fiercest attacks on Harvard, which accepts 27 per cent of its students from abroad. But international students in universities across the country have expressed fears that if they return home for the summer they may not be readmitted. Suzanne Rivera, president of Macalester College in Minneapolis, one-fifth of whose students are from overseas, has launched a fundraising campaign with alumni and is creating additional internships to support foreign students who decide not to leave the US for the holidays. 'Our concern right now is that these policy shifts may erect obstacles that would prevent students returning to campus or new ones from matriculating,' she said. 'The fear is widespread for the international students among us that if they go home they might encounter difficulties trying to re-enter even if they have a valid visa.' New York University, Northeastern and Hult are among the universities with campuses in other countries, which allows them to reallocate places abroad to non-US students if visa delays persist. Several others have branch campuses in Qatar. Martin Boehm, executive vice-president of Hult International Business School, said he had not yet seen any visa problems with prospective students. 'I'm still super confident that everything runs smoothly.' However, delegating teaching to partner universities could produce complications because of different costs and academic standards, and uncertainty over whether students can receive credit for courses completed elsewhere. Grant Cornwell, president of Rollins College in Florida, which has about 10 per cent of its student body from abroad, said the presence of foreign students provided more than just financial benefits. 'Those perspectives bring enrichment to the classroom that speaks directly to our mission: have students learn with and from people who see the world differently,' he said. 'Both current and incoming students are anxious as they await visa appointments for new issuances and renewals. We think there could be a chilling effect for the following years.' – The Financial Times Limited 2025
Irish Times
8 hours ago
- Irish Times
More than 20 Irish companies on Asian trade mission
More than 20 food and drink companies are seeking new business in South Korea and Japan this week with Martin Heydon , Minister for Agriculture and key State export agencies. Mr Heydon is leading a trade mission, with Enterprise Ireland , the agency responsible for developing Irish industry, and Bord Bia , which promotes the country's food business abroad. The mission's two legs will involve 22 Irish companies, including the likes of Kerry Group, Jameson, Lakeland Dairies, Carberry, Sliver Hill Duck, Kepak, ABP and Tírlan. Mr Heydon predicted that the visit would allow the Republic to build on commercial and official relationships it has developed with Korea and Japan. READ MORE Japan is the world's third biggest beef importer while Korea ranks fourth. Between them they buy more than one million tonnes a-year. The mission will take in Seoul Food, Korea's biggest exhibition for the food and drinks industries, and Expo 2025 in Osaka, Japan, expected to lure more than 28 million visitors and in which 160 countries are participating. The Korean leg will give producers the opportunity to build on the opening of that country's market to Irish beef last year, when the product was launched in September. Jim O'Toole, Bord Bia chief executive, pointed out that Irish beef has a competitive edge over rivals as it is grass fed, which the agency's research shows Korean consumers regard as healthier and more natural. 'This sets us apart from our grain-fed competitors in the market, and one we are using to reach an affluent consumer base,' he said. Mr Heydon stressed that the mission's focus was to build on and promote the State's reputation in agri-food in the Republic of Korea and Japan and the wider Asia market. It offered opportunities to 'showcase Ireland as a source of high-quality food, including dairy products, meat, seafood, drinks, prepared consumer foods and food ingredients', he added. The Japanese leg will include a focus on the drinks business, with a dozen companies from that industry represented, including Clonakilty Distiller, Dingle Distillery, Curraghmore Irish Whiskey, and Hyde Irish Whiskey. Expo Osaka will include an Irish Whiskey VIP Tour for buyers and media. Drinks is one of the Republic's more valuable home-grown industries, serving 113 export markets worth €2 billion in 2024. The mission will also have a political element with two ministerial meetings. Mr Heydon recently pointed out that it was critical for Irish agri-food to continue seeking new markets.
