Shipping: Tracking The Trends In Chinese Exports

Chinese seaborne imports have played a hugely significant role in driving growth in global seaborne trade in recent times, but exports from the country have had an important impact too. While growth in Chinese exports seems to have hit a slight bump in the road this year, since 2010 Chinese exports have expanded by a robust 50%, compared to growth of 22% in global seaborne trade in the same period.

Onto New Ground

In 2016, Chinese seaborne exports totalled c.580mt, up from 390mt in 2010. Chinese exports are mainly comprised of manufactured goods typically shipped in containers, steel products, various other minor bulk commodities, oil products and chemicals, amongst others. Exports grew especially firmly in 2013 and 2014, by an average 16% p.a., supported by robust expansion in minor bulk exports. Between 2012 and 2014, minor bulk exports rose 74% to 258mt, accounting for three quarters of the growth in total Chinese exports in this period, with shipments of various minerals and steel products rising firmly. China exported 54mt of steel products in 2012, and over 100mt by 2015 as domestic oversupply of steel encouraged producers to sell products overseas.

However, improved domestic steel demand in 2017 so far, combined with ‘supply-side’ reform in the steel industry, has led to a tighter steel market in China this year. As a result, Chinese steel products exports fell 30% y-o-y in January-September 2017 to 58mt, undermining total Chinese export growth. Environmental protection efforts have also impacted output of fertilisers in recent years, with exports down 10% y-o-y in 2017 so far.

A Well-Oiled Path

However, Chinese exports of oil products and chemicals have continued to expand in 2017 so far, after a positive 2016. Exports of oil products surged by 51% in 2016 to 36mt, due to government efforts to reduce domestic oversupply by raising export quotas. While the volume of quotas granted this year has fallen by 17%, oil products exports still look set to grow in 2017 for the fifth consecutive year.

Ticking The Boxes

Meanwhile, Chinese container exports have shown consistent growth since 2009. Following a period of slower expansion in 2015, growth in Chinese container shipments has accelerated, and is estimated to have reached 6% y-o-y in 2017 so far. This pick-up has reflected improving overseas consumer demand, including in the US, Europe, and southern hemisphere economies. While the recent closure of some Chinese factories as part of wider environmental efforts may have had some effect on container export volumes, the impact so far appears to have been smaller than initially feared, with total Chinese container exports on track to expand at a faster pace than last year in full year 2017.

So, China’s seaborne exports have expanded significantly over the last few years, even if 2017 may see a slightly less positive overall trend. With volumes this year held back principally by a sharp fall in exports of steel products, providing that steel exports start to stabilise and container trade growth remains firm, it may not be long before Chinese exports start to push ahead once again.

Source: Clarkson Research Services Limited

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