Are exports to China set to jump?

By Leith van Onselen

An interesting piece of information arising from yesterday’s Chinese data dump was the increase in imports from Australia, which grew by 10.9% in the month of August and by 2.9%  over the year.

A chart tracking Chinese imports from Australia (in USD) against Australian exports to China (in AUD) is shown below:

Based on this chart, we might expect August’s international trade data – due for release by the Australian Bureau of Statistics next month – to show a nice bounce in exports to China, which seemingly contradicts the recent sharp deterioration in the iron ore price – Australia’s biggest export to China. Some mix of volume growth and contract pricing delaying price falls make this possible.

Looking forward, the situation will deteriorate.

Twitter: Leith van Onselen. Leith is the Chief Economist of Macro Investor, Australia’s independent investment newsletter covering trades, stocks, property and yield. Click for a free 21 day trial.

 

Comments

  1. 1. The chart creates confusion because it’s valued in AUD & USD. Isn’t there data available in USD from the ABS ?
    2. I would trust the australian data more than the chinese data. E.g. chinese data understate e.g. chinese steel production.