CHINESE exports tumbled 8.3 percent in July, their biggest drop in four months and far worse than expected.

    Imports also fell heavily from a year earlier, in line with market forecasts but suggesting domestic demand might be too feeble to offset the weaker global demand for China’s exports.

    Economists had forecast exports to fall just 1 percent, after a 2.8 percent uptick in June, but the Saturday data showed depressed demand from Europe and the first drop in exports to the United States, China’s biggest market, since March.

    Exports to the European Union fell 12.3 percent in July while those to the United States dropped 1.3 percent. Demand from Japan, another big trading partner, slid 13 percent.

    Imports fell 8.1 percent, according to the data from the General Administration of Customs. That compared with forecasts for an 8 percent drop, after a 6.1 percent decline in June, though these falls also reflected weaker commodity prices.

    China recorded a trade surplus of US$43.03 billion for the month, below forecasts of US$53.25 billion.

    Economists also blame a strong yuan for the export weakness, with ANZ Research estimating the currency’s nominal effective exchange rate has risen by 13.5 percent since June 2014.

    China’s weak import figure partly reflects weak commodity prices paid to trading partners such as Australia. Volume imports of most major commodities were higher than expected as Chinese industry took advantage of the lower prices to restock on raw materials.

    Coal deliveries in particular rose strongly in July, up 28.1 percent, though commodity analysts said that prospects for the market remained dim overall.

    Stephen Koukoulas, managing director of Australian consultancy Markets Economics, said the fall in commodity prices was a major concern for the Australian and New Zealand economies, which both rely heavily on demand from China.(SD-Agencies)