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China’s automotive market has bounced back over the last quarter, with automotive sales up for the last three months.
Marking a third straight month of year-over-year increases, China’s June automotive sales were up 11.6%, according to data recently released by the China Association of Automobile Manufacturers (CAAM).
True to form, if not to scale, Beijing resorted to infrastructure spending this quarter to support the economy as it sought to pull the country out of government-imposed lockdowns in the first quarter.
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India has imposed definitive anti-dumping duty on certain steel products imported from China, South Korea and Vietnam after an investigation established these items caused injury to domestic producers.
Can China ever record economic growth greater than 6%?
We don’t know, but if I were a betting man I’d say not.
After contracting some 6.8% in the first quarter of this year, estimates vary with respect to what China’s GDP growth will be for 2020 in total. CRU expects between 2-3%, according to a Financial Times article, but analysts polled by the South China Morning Post are quoting between 1.5-2.5%, with some major banks, like UBS, expecting growth at the bottom of that range.
Many view tiny Hong Kong as something of an anathema — a hangover from the days of the British empire, part of China but not part of China, often missing the point that that is exactly its strength (or has been).
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After the last crisis, China was instrumental in spurring global growth and helped pull the West and neighboring economies along with it. Through state stimulus, China achieved double-digit growth, far beyond what its underlying economy would have otherwise been capable.
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This morning in metals news, Brazilian miner Vale’s iron ore production dropped 18% in Q1, U.S. total energy exports exceeded imports in 2019 and China has imposed new scrap import quotas.
We are not claiming any particular foresight on this, but a recent Reuters article yesterday covers a topic we wrote on last week concerning the disconnect between China’s aluminum smelters, which managed to raise output by 2.4% during the troubled first two months of this year, and the downstream aluminum semi-finished product producers, which all but shut down due to the enforced government lockdown in many parts of the country.
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The result we and Reuters report is SHFE stocks have mushroomed from 185,127 metric tons at the end of December to 519,542 tons now, as smelters churned out metal that no one could use.
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Falling infection rates to the lowest level since January and President Xi Jinping’s visit to Wuhan yesterday suggest all is returning to normal in China.
Some are looking for a V-shaped bounce back and maybe even a softer hit to Q1 GDP growth than previously feared.
A Reuters poll of Economists reported last week a revised growth forecast for the first quarter, falling to a median of 3.5% this quarter from 6.0% in the fourth quarter of 2019 — optimistically, a full percentage point lower than predicted in their last poll Feb. 14.
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Manufacturers are increasingly questioning whether their supply chain is likely to be exposed to disruption from the coronavirus outbreak ravaging China.
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Even if your company does not source product directly from China, many companies are still predicting supply chain disruption as the raw materials used by their manufacturing plants — which can be located anywhere in the world — probably originates in China.