China’s Trade Boom Survives Extreme Rains as AI Lifts Demand

Skip to Content News Archives Economy Energy Oil & Gas Renewables Electric Vehicles Mining Commodities Agriculture Real Estate Mortgages Mortgage Rates Finance Banking Insurance Fintech Cryptocurrency Work Wealth Smart Money Wealth Management Investor Personal Finance Family Finance Retirement Taxes High Net Worth FP Comment Executive Women Puzzmo Newsletters Financial Times Business Essentials More Innovation Information Technology FP500 Podcasts Small Business Lives Told Tails Told Shopping Financial Post Store Obituaries Place a Notice Advertising Advertising With Us Advertising Solutions Postmedia Ad Manager Sponsorship Requests Classifieds Place a Classifieds ad Working Profile Settings My Subscriptions Saved Articles My Offers Newsletters Customer Service FAQ News Economy Energy Mining Real Estate Finance Work Wealth Investor FP Comment Executive Women Puzzmo Newsletters Financial Times Business Essentials This advertisement has not loaded yet, but your article continues below.HomePMN BusinessChina's Trade Boom Survives Extreme Rains as AI Lifts DemandChina’s exports and imports managed to ride out the disruptions caused by extreme weather in July, as a global investment supercycle in artificial intelligence powers tech demand overseas and at home.Author of the article: You can save this article by registering for free here. Or sign-in if you have an account.anwibm8ygu[4gn4f[nv}ey4r_media_dl_2.png China's General Administration o(Bloomberg) — China’s exports and imports managed to ride out the disruptions caused by extreme weather in July, as a global investment supercycle in artificial intelligence powers tech demand overseas and at home.THIS CONTENT IS RESERVED FOR SUBSCRIBERS ONLYSubscribe now to read the latest news in your city and across Canada.Exclusive articles from Barbara Shecter, Joe O'Connor, Gabriel Friedman, and others.Daily content from Financial Times, the world's leading global business publication.Unlimited online access to read articles from Financial Post, National Post and 15 news sites across Canada with one account.National Post ePaper, an electronic replica of the print edition to view on any device, share and comment on.Daily puzzles, including the New York Times Crossword.SUBSCRIBE TO UNLOCK MORE ARTICLESSubscribe now to read the latest news in your city and across Canada.Exclusive articles from Barbara Shecter, Joe O'Connor, Gabriel Friedman and others.Daily content from Financial Times, the world's leading global business publication.Unlimited online access to read articles from Financial Post, National Post and 15 news sites across Canada with one account.National Post ePaper, an electronic replica of the print edition to view on any device, share and comment on.Daily puzzles, including the New York Times Crossword.REGISTER / SIGN IN TO UNLOCK MORE ARTICLESCreate an account or sign in to continue with your reading experience.Access articles from across Canada with one account.Share your thoughts and join the conversation in the comments.Enjoy additional articles per month.Get email updates from your favourite authors.THIS ARTICLE IS FREE TO READ REGISTER TO UNLOCK.Create an account or sign in to continue with your reading experience.Access articles from across Canada with one accountShare your thoughts and join the conversation in the commentsEnjoy additional articles per monthGet email updates from your favourite authorsSign In or Create an AccountShipments abroad climbed more than forecast and grew 23.9%, their second straight month of gains in excess of 20%, according to data released by the General Administration of Customs on Friday. Imports advanced 27.5%, leaving a trade surplus of $112.5 billion and putting it on track to exceed last year’s record level.“The strong outturn came despite typhoon-related disruptions at major ports,” Barclays Plc analysts led by Yingke Zhou said in a report. “AI-related and green-tech exports continue to benefit from the global AI investment cycle and energy transition, but weakness in labor-intensive exports continues to weigh on the job market and consumption.”Get the latest headlines, breaking news and columns.By signing up you consent to receive the above newsletter from Postmedia Network Inc.A welcome email is on its way. If you don't see it, please check your junk folder.The next issue of Top Stories will soon be in your inbox.We encountered an issue signing you up. Please try againAfter absorbing the shocks of Donald Trump’s tariffs and the war in the Middle East, the world’s biggest manufacturing nation is pulling through a period of heavy rains. Typhoon Bavi became the strongest storm to hit the powerhouse economy of Zhejiang province in nearly eight decades and some of the country’s busiest ports suspended operations temporarily.Soaring overseas shipments for AI-related electronics as well as other cutting-edge products like electric vehicles have cushioned growth from a deeper slowdown this year. At the same time, the boom in trade is widening a persistent divide within the economy and reducing the need for Chinese officials to step up support to domestic consumers despite weak demand at home.“Exports remain the main growth engine,” said Lynn Song, chief economist for Greater China at ING Bank NV in Hong Kong. “This year’s K-shaped divergence in China looks like it will continue in the months ahead as external demand is clearly much stronger than domestic demand.”What Bloomberg Economics Says …“China’s trade data continue to show a widening divide between the old and new economies. Robust import and export growth in July demonstrated the strength of tech-related manufacturing, while exports of traditional products lagged well behind the headline pace. We expect that pattern to persist, with tech-related sectors staying strong and supporting overall exports.”— David Qu, China economist. Click here to read the full reportThe rising dominance of Chinese companies across the global value chain has also led to rising tensions with Europe and the US, especially in areas like carmaking and more recently hardware for data centers. China’s swelling trade surplus has also prompted a heated discussion among economists over the role the domestic currency played in protecting the country’s manufacturing edge.This advertisement has not loaded yet.This advertisement has not loaded yet, but your article continues below.Chinese officials have been pledging to achieve “balanced trade” and boost purchases from abroad since early this year. Imports did surge this year, though price factors played a more important role. In a sign that even soaring imports are struggling to catch up with strong exports, China’s year-to-date trade surplus in July exceeded its level from the same time last year for the first time since February.Surging prices for chips and commodities like oil and metals have inflated China’s trade figures, with exports and imports rising less in volume terms. And as trillions of dollars pour into AI, a shortage for semiconductors and other electronics has sent some chip prices soaring as much as 700% over the past year.Export prices rose 8% from a year ago in June, according to the latest official data, increasing for the third straight month after nearly three years of declines. The prices of imports surged 25% in June, the fastest increase since data began in 2006. In volume terms, imports grew just 4% in June. The extreme weather may have contributed to a slight slowdown in trade last month. Several consecutive typhoons including Bavi created a jam at ports during a peak season for exporters. A gauge tracking outbound container shipping costs surged to the highest level since September 2024.“Stepping back, exports remain very strong, with the slight deterioration last month partly due to temporary disruptions to port operations from recent typhoons,” said Julian Evans-Pritchard, head of China economics at Capital Economics.The latest data added to a picture of an economy whose reliance on high-tech and AI-driven exports makes it less vulnerable to intense weather events.Exports of chips and computers kept soaring in July thanks to higher prices, climbing 117% and 67% from a year ago, respectively. Overseas sales of cars jumped 60% while ships surged 92%. The growth for general machinery accelerated to 31% from 15% in June.And while tensions with major trading partners have escalated, China’s trade surplus with the European Union is still climbing, reaching a fresh record of $33.8 billion in July.China continued to curb its imports of crude oil, though their decline in volume terms narrowed to 24% from a year earlier versus 41% in June.(Updates with comment in third paragraph.)Notice for the Postmedia NetworkThis website uses cookies to personalize your content (including ads), and allows us to analyze our traffic. Read more about cookies here. By continuing to use our site, you agree to our Terms of Use and Privacy Policy.