From Bloomberg via Yahoo Finance, September 1/2:
Inventories of key raw materials are piling up in China, evidence that economic activity remains too feeble to clear a surplus that’s crushing prices from steel to soybeans.
The government’s growth target for the year looks increasingly out of reach, an unwelcome development for the drillers, miners and farmers that supply the world’s biggest importer of commodities. The blowout in stockpiles might suggest that some traders were caught out by the economy’s poor performance since the end of the pandemic. Others may have underestimated the extent of China’s pivot from the old economy to the new.
But the stockpiling is also testimony to the premium placed by Beijing on making sure its factories and citizens never run short. Even when its economy is hot, China houses outsized quantities of raw materials. It holds more than 90% of the world’s visible copper inventories, nearly a quarter of the world’s crude oil, and over half of staple crops like corn and wheat, according to research from JPMorgan Chase & Co.
So, while consumption and industrial activity are surely weak, China’s state-owned importers may be not be too fussed if they’ve mistimed their purchases, given their mission to guarantee that the country’s reserves are sufficient come what may.
Coal Pile
The power-shortage scares of 2021 and 2022 drew renewed scrutiny of China’s energy security, especially around the availability of its mainstay fuel — coal. Beijing’s response was to lift production and imports to record levels....
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Also from Bloomberg via Yahoo Finance, September 1/2:
Asian Shares Slip as China Factory Activity Slides: Markets Wrap
