Chinese seaborne imports have grown firmly in recent years to reach a total 2.0bt in 2013, and have accounted for a significant proportion of growth in global seaborne trade. While import growth is expected to slow slightly this year (to 6%, from 11% in 2013), growth in exports has accelerated. After increasing by 2% in 2012, exports rose 11% in 2013 to reach 459mt, and have expanded by 19% y-o-y in January-July 2014.

All Boxed Up

Containerisable cargoes account for the largest proportion of China’s exports in tonnes, and this year are expected to represent 41% of total shipments. In recent years, growth in exports of containerisable cargoes has been a major driver of total Chinese export growth (accounting for more than 90% of expansion in 2011 and 2012). After slowing to an estimated 4% in 2012, growth in containerisable cargo exports has since picked up, supported by improved consumer demand in Europe and the US. In January-July 2014, estimated containerisable cargo exports increased by 12% y-o-y, with absolute growth of 14mt expected in the full year.

Minor Bulk, Major Boost

Meanwhile, exports of minor bulks have increased even more strongly. In 2014, minor bulk exports are expected to total 243mt, up 39% y-o-y, and up from 149mt in 2012. This level of exports would represent the first time Chinese minor bulk shipments have exceeded exports of containerisable cargoes in tonnes since 2009.

This firm increase in minor bulk exports is expected to account for 80% of total Chinese export growth this year, with shipments of steel products, pebbles and mineral sands up 39%, 68% and 72% y-o-y respectively in the year to date. As shown on the Graph of the Month, absolute growth in exports of these commodities is expected to total almost 60mt in full year 2014.

Overcapacity in the domestic steel and fertiliser industries, and slower growth in domestic demand in these sectors has contributed to producers increasing overseas shipments. Certain government policies have also provided support. Domestic steel producers can reportedly receive tax rebates on exports of certain steel products, while fertiliser producers have benefitted from a decrease in fertiliser export taxes at the start of 2014. Meanwhile, increased shipments of mineral sands and pebbles (primarily to Hong Kong and Macau) have been driven by land reclamation and other construction projects in these areas.

Positive Prospects?

The outlook for Chinese seaborne exports remains optimistic, particularly as growth on mainlane container trades from the Far East has picked up notably this year. In addition to improving overseas demand, the Chinese government has been actively seeking to boost exports, through both domestic policy changes and greater economic co-operation with other developing economies, to whom China is increasingly exporting infrastructure and building materials. While containerisable cargoes are likely to remain a key part and driver of China’s seaborne exports, shipments of minor bulk commodities and project-related cargoes could also play an increasingly important role.