China's unstoppable property contruction crash

I will offer up a comprehensive take on the freshly released Chinese data for April tomorrow. But, for now, get a load of the disaster unfolding in property construction.

April was the weakest month of starts in fifteen years, the middle of the GFC:

This has established a 2023 trend for starts by floor area that is far worse than even I forecast:

I can’t forecast this anymore. I’m just not bearish enough:

The rate of falls has slowed a little but is still -27% year on year:

Starts by floor area are on track to be 60% below the 2021 peaks. This is the equivalent of 18% of China’s consumed steel.

China is going ex-growth right before our eyes and, as infrastructure slows, bulk commodities are going to be routed.

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About the author

David Llewellyn-Smith is Chief Strategist at the MB Fund and MB Super. David is the founding publisher and editor of MacroBusiness and was the founding publisher and global economy editor of The Diplomat, the Asia Pacific’s leading geo-politics and economics portal. He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.

China’s unstoppable property contruction crash