Supply Chain Troubles Easing, Trade Figures Suggest
Bottlenecks at U.S. ports have raised the alarm about supply chains, but the manufacture and shipping of essential goods from the U.S.’s biggest supplier of goods are operating smoothly, suggesting that supply chain troubles are easing, according to an analysis by Trade Data Monitor, the world’s top source of trade statistics.
Exports from China, by far the U.S.’s top supplier of goods for U.S. consumers, increased 27.1% to $300.2 billion in October. Shipments to the U.S. leapt 22.8% to $53.8 billion. After reaching a nadir during the Covid crisis, China has now registered 13 straight months of double-digit export growth.
This suggests that two other factors might be creating the sense of a supply chain crisis. One is inflation. Prices for essential commodities are continuing to rise, trade figures show. Another is demand from other parts of the world, especially Asia. There are simply more middle- and upper-class consumers buying the same goods that Europeans and Americans have coveted for decades.
The pandemic’s work-from-home economy appears to be subsiding. People are buying more of the things they need to move about the world. Chinese exports of shoes rose 35.5% to $4.3 billion. Shipments of suitcases and luggage increased 44.9% to $2.7 billion. While some of that increase was due to a rise in prices, it was mostly because people really are traveling more. Exports of luggage by quantity, for example, shot up 31.5% to 231,000 tons.
Chinese trade figures continue to show inflation in prices of key commodities. Imports of grain, for example, declined 25.2% by quantity, to 9.7 million tons, but rose 0.2% by value, to $4.6 billion. Crude petroleum imports fell 11% by quantity, to 37.8 million tons, but increased 53.5% by value, to $20.7 billion. If Chinese consumers and factories are paying billions more to receive less oil, that is bound to ripple throughout the global economy.
Another worrying sign for the U.S.: Imports of soybeans, a key part of Trump-era trade agreements with China. declined 41.1% by quantity, to 5.1 million tons. By value, those shipments fell only 12.1%, to $3.5 billion.
The growth of China’s automotive industry has reached a phase of exponential growth that will soon make it entirely self-sufficient, trade statistics show. Exports of motor vehicles increased 155% to $3.7 billion, while Chinese imports of motor vehicles shrank 46.8% to $2.7 billion. Imports of auto parts declined 18.7% to $2.6 billion.
That will be a disappointment to major economic rivals who had hoped to ramp up exports to China. Imports from the EU shrank 0.7% to $22.6 billion. Asia countries overall are faring much better in the fight for market share in China. Exports to Japan rose 16.5% to $14.3 billion, whole, imports increased 10.1% to $16.4 billion. Exports to ASEAN countries grew 18.4% to $40.6 billion. Imports increased 23.1% to $31.9 billion.
Like other countries, China is reckoning with the pollution and carbon emissions created by aggressive industrialization. It’s pledged to fight climate change as part of a broad economy reform that is also meant to reduce debt, boost its high-tech sector and combat climate change.
However, the gap between policy and practice will limit effective change. In October, natural gas imports rose 25.5% to 9.4 million tons, up 144.1% to $5 billion by value. However, coal imports rose 98.7% to 27 million tons. By value, these imports almost tripled, up 297% to $3.6 billion.