Electromechanical accounted for 60% of the leading exporter's exports

Customs statistics show that in July this year, China’s import and export value was US$262.31 billion, an increase of 30.8%. Among them, the export volume was 145.52 billion U.S. dollars, up 38.1%, which was lower than the 43.9% of the previous month; the import was 116.79 billion U.S. dollars, up 22.7%, which was significantly lower than the 34.1% in June. , And this "between one fast and one slow", resulting in the further expansion of the trade surplus in July, reaching 28.7 billion US dollars. This data also exceeded market expectations.

By month-on-month, imports and exports in July increased by 3% from the previous month in June. This is also the month after last month, the monthly export value and the total value of imports and exports once again hit a record high, once again refreshed the historical record since July 2008; cumulatively, in the first 7 months of this year, China's total import and export value of 1,617.05 billion US dollars, This was an increase of 40.9% over the same period last year. Among them, exports accounted for 850.49 billion U.S. dollars, an increase of 35.6%; imports accounted for 766.56 billion U.S. dollars, an increase of 47.2%; and the trade surplus was 83.933 billion U.S. dollars, a decrease of 21.2%.

Data show that China’s foreign trade has generally returned to pre-crisis levels. Yang Fan, an export analyst at Monita, told the “Daily Economic News” that the rapid growth of electromechanical products strongly supported a steady recovery of exports, with a relatively large share of electromechanical products, while a substantial increase in rice and corn exports was due to international food exports. Prices have risen steadily.

According to customs statistics, in the first seven months of this year, China's export of electromechanical products increased by 36.2%, which was 0.6% higher than China's overall export growth over the same period, accounting for 58.9% of China's total export value over the same period. In addition, the growth rate of exports of traditional bulk commodities, including clothing, furniture, footwear, plastic products, bags and textile yarns, fabrics and products, accelerated over the first half of the year.

According to Zuo Xiaolei, chief economist of Galaxy Securities, the export data is in line with the signal shown by the leading index manufacturing PMI new export order index, which is due to the sharp increase in short-term orders. He Zhicheng, senior economist of the Agricultural Bank of China [2.690.00%], pointed out that canceling some of the "two high and one capital" product export tax rebates since July 15 triggered export companies to rush to complete the annual export plan before the timetable. The surprise export in June and the first half of July was also the main reason for the increase in export volume.

In addition, the export growth rate is slightly higher than expected, also shows that China's economy lags behind the adjustment of European and American economies. The slowdown in the growth rate of European and American economies has limited impact on China.

According to Gao Shanwen, chief economist of Essence Securities, the competitiveness of China’s export industry is increasing, and the growth of emerging economies and developed countries is delinking, while the Chinese export structure is more inclined to emerging economies. He optimistically increased the annual export growth rate from 20% of the original forecast to more than 25%.

Depreciation in imports shows slower growth in domestic investment

The growth rate of imports was slightly lower than expected, but it declined by 11.4 percentage points. Experts believe this indicates that domestic demand continues to slow down. The main reason is that the increase in macroeconomic controls has led to a decrease in imports.

Customs data showed that the average price of major commodity imports was rapidly rising year-on-year. In the first seven months of this year, the import of iron ore was 360 million tons, an increase of 1.5%, the average import price was 116 dollars per ton, up 53.3%; the import of soybeans was 30.76 million tons, an increase of 16.2%, and the average import price was 439 dollars per ton. Rose 4%. In addition, imports of machinery and electronic products 360.28 billion US dollars, an increase of 42.8%, of which 459,000 imported vehicles, an increase of 1.5 times.

Lu Zhiming, a research fellow at the Bank's Golden Research Center, said that the import volume and its year-on-year growth rate were mainly due to the slowdown in domestic investment demand for bulk commodities such as energy and raw materials. In July, China’s imports of bulk commodities, such as primary plastics, steel, and crude oil, all declined in the month, from 35.26, 18.42, and 12.553 billion U.S. dollars in June to 33.75, 17.88, and 10.276 billion U.S. dollars in July.

In addition, the fluctuation of the exchange rate of the RMB and the increase in foreign trade friction have affected the import demand for processing trade. The Bank of Communications [6.27-0.48%] pointed out that as processing profits have narrowed and export conditions have worsened, the import demand of manufacturers has been weak. Last year, the effect of the base period was also gradually weakening. In July, the import growth rate fell sharply by 11.4%.

Despite the slowdown in industrial growth and slowing domestic demand, Zuo Xiaolei saw that the bulk of imported bulk products is still growing, which means that China’s economy is still undergoing steady and active development, and the slowdown in domestic demand is also stabilizing.

Super high trade surplus brings about the appreciation of the renminbi

The widening of the gap between imports and exports led to a large increase in the trade surplus in July, the highest in 18 months. Customs data showed that the trade surplus in July was 28.7 billion U.S. dollars, up from 20.02 billion U.S. dollars in the previous month. The larger-than-expected trade surplus was due to import adjustments earlier than exports.

Jackson, a strategist at Royal Bank of China, Hong Kong Branch of the Royal Bank of Canada, predicted that the data to be released later this week is likely to show that the U.S. trade deficit exceeds US$40 billion. Such a high trade surplus has caused the market to worry about the appreciation of the renminbi.

Xing Ziqiang, an economist at China International Capital Corporation, predicts that the yuan will appreciate by about 3% from June to the end of the year.

“The growth of China’s exports in the third and fourth quarters will show a clear slowing trend and the growth rate will be significantly lower than that in the first half of the year.” He Zhicheng said that the significant increase in trade surplus data was due to the sharp slowdown in imports, which really put the RMB at a disadvantage, but he Emphasizing that the high surplus in July is unsustainable and transitory, the data will decline significantly thereafter. Therefore, it is too early for the RMB to rise. He Zhicheng believes that although the CPI data in July and August may be higher, the macroeconomic policy will remain stable and there will be no major adjustments.

Yan Wei, chief economist of Orient Securities, analyzed that the domestic import demand will be small in the second half of the year and the import data will fall back quickly. The annual trade surplus is expected to be the same as last year. Lu Zhiming believes that in view of the external environment, after the subprime mortgage crisis in developed countries in Europe and America regained the priority strategy of the export industry, trade friction with China will continue to increase. Coupled with the gradual start of the destocking cycle, the external export environment may continue to deteriorate in the future; From the internal point of view, the increase in the pressure of rising mid- and long-term wages, the increase in exchange rate fluctuations of the RMB, and the narrowing of profitability of export companies, and the accumulation of many factors may have a greater impact on the fall in export growth.