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Yahoo
4 hours ago
- Business
- Yahoo
China's exports likely slowed in May amid trade uncertainties: Reuters poll
By Yukun Zhang and Liz Lee BEIJING (Reuters) - Growth in China's exports likely slowed in May despite a lowering of U.S. tariffs on Chinese goods, as the fallout from the still-unresolved trade war and uncertainties in Sino-U.S. ties weighed on shipments. Outbound shipments are projected to have risen 5.0% year-on-year in value terms last month, according to the median forecasts of 20 economists polled by Reuters. That compares with an 8.1% jump in April. Imports are forecast to drop 0.9% in May from the previous year in value terms, widening from a 0.2% dip in April. The global trade war and the swings in China-U.S. trade ties have in the past two months sent Chinese exporters, along with their business partners across the Pacific, on a roller coaster ride. An hour-and-a-half-long phone call between U.S. President Donald Trump and Chinese leader Xi Jinping late Thursday kept the lid on tensions but left key trade issues such as Beijing's control on rare earth exports and Washington's curbs on chip-related exports to further talks. In mid-May, China and the United States struck a 90-day truce in their bruising tariff war and walked back most of the triple-digit levies they heaped on each other's goods, which had taken effect in early April. Those tariffs, as well as uncertainties surrounding the global trade order after the Trump administration ordered a 90-day pause to its "reciprocal tariffs" on other trade partners, had accelerated China's exports in March and April, as factories rushed out shipments to the U.S. and overseas manufacturers. The lowering of U.S. tariffs on China, however temporary, was welcome news to China's policymakers as they seek to shore up an economy reliant on exports and beset by lacklustre domestic demand and sagging prices. Economists polled by Reuters appear divided on how the turnabout from the Geneva trade talks would impact China's overall exports last month, with estimates ranging from a 9.3% growth to a 2.5% drop. The tariff truce might trigger a new round of frontloading and reduce the urgency for the Chinese government to "roll out a sizable stimulus package and start some necessary structural reforms", Nomura analysts wrote in a report on May 23. The Nomura analysts estimate that average U.S. tariffs on Chinese imports could remain "hefty at about 42%" even without further hikes, and expect China's export growth to slow down sharply in the second half of the year. China's first-quarter economic growth beat expectations, but any cheer was overridden by persistent strains in China-U.S. ties. Factory activity data for May shows Chinese manufacturers may have already felt the tariff pains. The official manufacturing purchasing managers' index (PMI) shrank for a second month in May, while the gauge in a private-sector survey shrank for the first time in eight months. The central bank last month cut benchmark lending rates to lessen the impact of the trade war on the economy, and lowered the ceiling for deposit rates to offset margin pressure on banks and prompt savers to spend or invest more. China's May trade surplus is forecast at $101.3 billion, up from $96.18 billion in April. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Reuters
4 hours ago
- Business
- Reuters
China's exports likely slowed in May amid trade uncertainties
BEIJING, June 6 (Reuters) - Growth in China's exports likely slowed in May despite a lowering of U.S. tariffs on Chinese goods, as the fallout from the still-unresolved trade war and uncertainties in Sino-U.S. ties weighed on shipments. Outbound shipments are projected to have risen 5.0% year-on-year in value terms last month, according to the median forecasts of 20 economists polled by Reuters. That compares with an 8.1% jump in April. Imports are forecast to drop 0.9% in May from the previous year in value terms, widening from a 0.2% dip in April. The global trade war and the swings in China-U.S. trade ties have in the past two months sent Chinese exporters, along with their business partners across the Pacific, on a roller coaster ride. An hour-and-a-half-long phone call between U.S. President Donald Trump and Chinese leader Xi Jinping late Thursday kept the lid on tensions but left key trade issues such as Beijing's control on rare earth exports and Washington's curbs on chip-related exports to further talks. In mid-May, China and the United States struck a 90-day truce in their bruising tariff war and walked back most of the triple-digit levies they heaped on each other's goods, which had taken effect in early April. Those tariffs, as well as uncertainties surrounding the global trade order after the Trump administration ordered a 90-day pause to its "reciprocal tariffs" on other trade partners, had accelerated China's exports in March and April, as factories rushed out shipments to the U.S. and overseas manufacturers. The lowering of U.S. tariffs on China, however temporary, was welcome news to China's policymakers as they seek to shore up an economy reliant on exports and beset by lacklustre domestic demand and sagging prices. Economists polled by Reuters appear divided on how the turnabout from the Geneva trade talks would impact China's overall exports last month, with estimates ranging from a 9.3% growth to a 2.5% drop. The tariff truce might trigger a new round of frontloading and reduce the urgency for the Chinese government to "roll out a sizable stimulus package and start some necessary structural reforms", Nomura analysts wrote in a report on May 23. The Nomura analysts estimate that average U.S. tariffs on Chinese imports could remain "hefty at about 42%" even without further hikes, and expect China's export growth to slow down sharply in the second half of the year. China's first-quarter economic growth beat expectations, but any cheer was overridden by persistent strains in China-U.S. ties. Factory activity data for May shows Chinese manufacturers may have already felt the tariff pains. The official manufacturing purchasing managers' index (PMI) shrank for a second month in May, while the gauge in a private-sector survey shrank for the first time in eight months. The central bank last month cut benchmark lending rates to lessen the impact of the trade war on the economy, and lowered the ceiling for deposit rates to offset margin pressure on banks and prompt savers to spend or invest more. China's May trade surplus is forecast at $101.3 billion, up from $96.18 billion in April.
Reuters
19-05-2025
- Business
- Reuters
China April crude steel output misses expectations
BEIJING, May 19 (Reuters) - China's crude steel output in April slid 7% from March, defying analysts' expectations of a rise against the backdrop of healthy profits and robust exports, but production was still reasonably high. The world's largest steel producer made 86.02 million metric tons of crude steel last month, flat with April a year ago and down from 92.84 million tons in March, data from the National Bureau of Statistics (NBS) showed on Monday. The April volume suggested average daily output of about 2.87 million tons, versus 2.99 million tons in March and 2.86 million tons in April 2024, according to Reuters calculations based on the data. Around 56% of steelmakers were operating at a profit in April, compared to 53% in March, a survey from consultancy Mysteel showed. Analysts said decent demand in China and robust exports helped support output last month. Steel mills want to ratchet up production, especially after having suffered severe losses in the past two years when demand was battered by a protracted property downturn, according to analysts. That will likely buoy output in May, they added. In the first four months of 2025, China manufactured a total of 345.35 million tons of crude steel, up 0.4% year on year, despite Beijing unveiling plans in March to restructure the giant steel sector via output cuts. Beijing has not disclosed essential details including the timing and scale of the output. However, the state-backed China Iron and Steel Association (CISA) said in a note on May 16 that the steel output controls will be mainly reflected in the second half of the year, contingent on the enforcement of local governments.
Reuters
17-05-2025
- Business
- Reuters
ASEAN countries face their own ‘China shock': Raychaudhuri
HONG KONG, May 16 (Reuters) - As the United States and Europe have sought to loosen their economic ties with China in recent years, Beijing has focused on expanding its export markets across the 'Global South', particularly in Southeast Asia. But this could create significant economic risks as the region's manufacturers struggle to compete. Regardless of the contours of any eventual U.S.-China trade deal, Beijing's exports to America seem destined to continue falling, as do those to the European Union. The bloc has been seeking to 'de-risk, opens new tab' from Chinese imports and supply chains, particularly when it comes to electric vehicles, batteries and solar power equipment. China's exports to the U.S. and the EU have already been declining steadily for years. In 2018, almost 20% of China's exports were to the United States. By 2024, this was down to 14.7%. The proportion of exports to the EU also declined, though less dramatically, from 17.0% to 14.4% during this period. China has actually been reducing its export dependence on all developed economies, including Japan, South Korea and Taiwan. Instead, the manufacturing powerhouse has been expanding ties with the 'Global South', particularly Southeast Asian nations (ASEAN). In fact, 16.4% of China's exports went to ASEAN in 2024. That's more than the shares claimed by the U.S. or the EU. China's focus on ASEAN accelerated after the 2018 trade war that started during U.S. President Donald Trump's first term, as exports bound for America appeared to be re-routed through Southeast Asian countries. The most notable example of this is Vietnam, whose incremental exports to the U.S. matched its incremental imports from China almost exactly in the first few years after the beginning of the previous Trump trade spat. But China is increasingly struggling to maintain this transshipment route. The Trump administration originally slapped staggeringly high 'reciprocal' tariffs on ASEAN economies on April 2, partly to hinder this export re-routing. While these tariffs have since been delayed, several Southeast Asian governments have begun to crack down, opens new tab on violations of 'country of origin' rules by their exporters to defend their reputations as responsible trade partners. And even though Chinese exports to ASEAN economies are currently mostly intermediate goods that are re-processed and exported, that is starting to change as more finished goods are ending up in Asia's domestic markets. These ASEAN imports of low-priced finished goods from China, many sold through e-commerce platforms, have already become a bugbear for local manufacturers, particularly in Indonesia and Thailand. In Indonesia, as imports of Chinese clothing have risen in recent years, the country's own textile sector has laid off workers, including 80,000 in 2024, with 280,000 more, opens new tab estimated to be at risk in 2025. In Thailand, more than 100 factories, mostly small and medium-sized enterprises, closed down every month from 2021 to 2024. According to independent think tank K- Research, opens new tab, these factories were mostly manufacturing furniture, electronics, garments, automotive and steel – all industries that have faced competition from inexpensive Chinese goods in recent years. Of course, Chinese foreign direct investment is also surging in ASEAN, particularly in the much touted 'New Three' sectors: EVs, batteries and solar energy. For example, Chinese automaker BYD commissioned a 150,000-unit EV factory in Thailand in July 2024, and Chinese battery maker CATL announced a $5.8 billion investment in Indonesia's nickel sector in 2023, though that was recently scaled back by half. While these investments have created jobs and helped ASEAN's integration into global supply chains, they have also disrupted local supply chains. In Thailand, oversupply of EVs has led to price wars and production cuts in the country's traditional auto market, resulting in the closure of a dozen of the country's auto parts manufacturers, opens new tab. Manufacturing seems to be stagnating across the region. Manufacturing PMIs are currently in the contractionary zone and on a steadily declining path in all the large ASEAN economies, reflecting both concerns about the trade war and the negative impact of increased Chinese exports to these markets. China's trade partners also face the prospect of cheap products pushing down prices in their home markets. Such imported deflation could potentially create a downward economic spiral in ASEAN economies, where consumers postpone purchases and companies delay investments, reduce wages and lay off workers. Some countries in this region, notably Thailand, are already experiencing deflation alongside China. Malaysia and Singapore may get there rapidly. Given all this, China's ASEAN trade partners will need to navigate today's ever-shifting trade and investment landscape with great care and trepidation. If history is any guide, we are likely to see these countries seek to boost domestic demand and pursue industrial policies to protect domestic companies. This protectionary impulse means the current trend toward greater ASEAN trade integration may start to slow. (The views expressed here are those of Manishi Raychaudhuri, the founder and CEO of Emmer Capital Partners Ltd. and the former Head of Asia-Pacific Equity Research at BNP Paribas Securities).
Zawya
16-05-2025
- Business
- Zawya
ASEAN countries face their own ‘China shock': Raychaudhuri
(The views expressed here are those of the author, the founder and CEO of Emmer Capital Partners Ltd.) HONG KONG - As the United States and Europe have sought to loosen their economic ties with China in recent years, Beijing has focused on expanding its export markets across the 'Global South', particularly in Southeast Asia. But this could create significant economic risks as the region's manufacturers struggle to compete. Regardless of the contours of any eventual U.S.-China trade deal, Beijing's exports to America seem destined to continue falling, as do those to the European Union. The bloc has been seeking to 'de-risk' from Chinese imports and supply chains, particularly when it comes to electric vehicles, batteries and solar power equipment. China's exports to the U.S. and the EU have already been declining steadily for years. In 2018, almost 20% of China's exports were to the United States. By 2024, this was down to 14.7%. The proportion of exports to the EU also declined, though less dramatically, from 17.0% to 14.4% during this period. China has actually been reducing its export dependence on all developed economies, including Japan, South Korea and Taiwan. Instead, the manufacturing powerhouse has been expanding ties with the 'Global South', particularly Southeast Asian nations (ASEAN). In fact, 16.4% of China's exports went to ASEAN in 2024. That's more than the shares claimed by the U.S. or the EU. WANING TRANSSHIPMENT China's focus on ASEAN accelerated after the 2018 trade war that started during U.S. President Donald Trump's first term, as exports bound for America appeared to be re-routed through Southeast Asian countries. The most notable example of this is Vietnam, whose incremental exports to the U.S. matched its incremental imports from China almost exactly in the first few years after the beginning of the previous Trump trade spat. But China is increasingly struggling to maintain this transshipment route. The Trump administration originally slapped staggeringly high 'reciprocal' tariffs on ASEAN economies on April 2, partly to hinder this export re-routing. While these tariffs have since been delayed, several Southeast Asian governments have begun to crack down on violations of 'country of origin' rules by their exporters to defend their reputations as responsible trade partners. And even though Chinese exports to ASEAN economies are currently mostly intermediate goods that are re-processed and exported, that is starting to change as more finished goods are ending up in Asia's domestic markets. CAVEAT EMPTOR These ASEAN imports of low-priced finished goods from China, many sold through e-commerce platforms, have already become a bugbear for local manufacturers, particularly in Indonesia and Thailand. In Indonesia, as imports of Chinese clothing have risen in recent years, the country's own textile sector has laid off workers, including 80,000 in 2024, with 280,000 more estimated to be at risk in 2025. In Thailand, more than 100 factories, mostly small and medium-sized enterprises, closed down every month from 2021 to 2024. According to independent think tank K- Research, these factories were mostly manufacturing furniture, electronics, garments, automotive and steel – all industries that have faced competition from inexpensive Chinese goods in recent years. Of course, Chinese foreign direct investment is also surging in ASEAN, particularly in the much touted 'New Three' sectors: EVs, batteries and solar energy. For example, Chinese automaker BYD commissioned a 150,000-unit EV factory in Thailand in July 2024, and Chinese battery maker CATL announced a $5.8 billion investment in Indonesia's nickel sector in 2023, though that was recently scaled back by half. While these investments have created jobs and helped ASEAN's integration into global supply chains, they have also disrupted local supply chains. In Thailand, oversupply of EVs has led to price wars and production cuts in the country's traditional auto market, resulting in the closure of a dozen of the country's auto parts manufacturers. Manufacturing seems to be stagnating across the region. Manufacturing PMIs are currently in the contractionary zone and on a steadily declining path in all the large ASEAN economies, reflecting both concerns about the trade war and the negative impact of increased Chinese exports to these markets. IMPORTED DEFLATION China's trade partners also face the prospect of cheap products pushing down prices in their home markets. Such imported deflation could potentially create a downward economic spiral in ASEAN economies, where consumers postpone purchases and companies delay investments, reduce wages and lay off workers. Some countries in this region, notably Thailand, are already experiencing deflation alongside China. Malaysia and Singapore may get there rapidly. Given all this, China's ASEAN trade partners will need to navigate today's ever-shifting trade and investment landscape with great care and trepidation. If history is any guide, we are likely to see these countries seek to boost domestic demand and pursue industrial policies to protect domestic companies. This protectionary impulse means the current trend toward greater ASEAN trade integration may start to slow. (The views expressed here are those of Manishi Raychaudhuri, the founder and CEO of Emmer Capital Partners Ltd. and the former Head of Asia-Pacific Equity Research at BNP Paribas Securities). (Writing by Manishi Raychaudhuri. Editing by Anna Szymanski and Mark Potter)
