China went on an unexpectedly big buying spree for crude oil, coal and iron ore last month, customs data showed on Thursday, even as Beijing cools its overheated property market and concerns linger about the health of the world’s No. 2 economy.
Daily crude imports hit an all-time high as the nation again overtook the United States as the world’s top oil consumer, while iron ore imports were the second highest on record, propelling Shanghai rebar steel futures to five-week highs .
Coal and soybean purchases were just below August’s total, but were better than analysts had expected.
Copper bucked the trend, with imports falling by more than a quarter to their lowest in over a year, the latest sign of waning appetite as local supplies remained plentiful.
The commodities data contrasted with overall statistics which showed imports unexpectedly shrank, stirring concerns that the steadying of the economy may be short-lived.
Rising imports of crude oil and other commodities reflected “an improvement in domestic demand as the economy steadies,” said Huang Songping, spokesman for the customs, at a briefing after the data.
Steel mills binged on iron ore as buoyant metal prices spurred output increases and demand from infrastructure and construction remained firm.
“(The strong iron ore figures) show the impact of continued closures in the domestic Chinese industry, but also the relatively strong demand from the housing and infrastructure sector, which has boosted steel production,” said Daniel Hynes, commodity strategist at ANZ.
Still some of the buying can be explained by lower domestic supplies and a need to replenish inventories, rather than any fresh optimism about underlying demand.
Utilities and steel mills bought more foreign coal than expected as Beijing clamped down on its polluting, inefficient mines, triggering a spike in prices and depleting local stocks.