CHINA’S exports growth lost steam in November, pressured by a strong yuan, weakening demand and higher costs, but imports unexpectedly accelerated as the country scrambled to restock depleted commodities like coal.

Exports rose 22 percent year on year in November, customs data showed yesterday, slower than the 27.1 percent jump in the previous month but faster than the 19 percent in a poll.

Buoyed by robust global demand, exports have been China’s single biggest growth driver since the recovery from the pandemic began. The strong growth has repeatedly shrugged off market expectations that exports would soon lose steam after other parts of the world gradually got back online.

But the resurgence of coronavirus in China’s trade competitors drove demand back to China, where stringent prevention measures kept business and production humming.

Exports to the Association of Southeast Asian Nations, China’s biggest trading partners, grew 22.3 percent from a year earlier, up from October’s 18 percent, according to calculations based on official data.

Shipments to the European Union, the No. 2 trading partner, slowed to 33.5 percent year on year, compared with October’s 44.3 percent. Exports to the United States, the No. 3 trading partner, rose 5.3 percent, down from 22.7 percent in October.

Imports climbed 31.7 percent, beating the 19.8 percent rise in October and well above the forecast 20.6 percent gain.

China’s coal imports in November hit their highest level in 2021, as the world’s biggest consumer of the fuel scrambled during the onset of winter to feed its power system, which had been experiencing shortages.

The easing of the power crunch also helped increase demand for copper. Imports of the key industrial metal hit their highest levels since March.

“Coal imports in particular soared. I think this reflects the policy change in China to solve the energy shortage problem, which constrained growth in the third quarter,” said Zhang Zhiwei, chief economist at Pinpoint Asset Management. “I don’t think there is a significant improvement of domestic demand yet.”

China’s trade surplus was US$71.72 billion last month, narrower than the poll’s forecast for US$82.75 billion and the US$84.54 billion surplus in October.

The data come a day after China’s central bank announced a cut to the amount of cash that banks must hold in reserve, its second such move this year, to bolster slowing economic growth.

The country has staged an impressive rebound from the pandemic but there are signs momentum is flagging. Power shortages and debt troubles in the property sector are weighing on China’s recovery.

A private sector survey showed factory activity fell in November, hit by higher prices and subdued demand although the government’s official survey showed activity grew in the month.

China’s factory-gate inflation hit a 26-year high in October as coal prices soared during the power crunch.

No cases of the Omicron COVID-19 variant have been reported in China to date, but its emergence could add pressure to the strict zero-tolerance policy on coronavirus cases and increase logistical challenges for exporters, analysts say.

But Omicron could also support China’s exporters in the near-term by keeping consumers abroad buying goods, rather than services, amid increased social distancing, said Julian Evans-Pritchard, senior China economist at Capital Economics, in a note. (SD-Agencies)