Staff of Reuters 3 Minutes to Read BEIJING, China (Reuters) – According to a Reuters poll released on Friday, China’s exports likely slowed in June due to virus outbreaks and port delays, despite strong global demand aided by lessening lockdown measures and vaccination programs. On April 28, 2021, container ships are visible in Qingdao port in Shandong province, China. Carlos Garcia Rawlins/File Photo/REUTERS Although the statistical base effects of steep drops a year ago are perceived as keeping headline trade numbers appealing, real demand has recovered significantly in recent months. Exports are anticipated to have increased 23.1 percent from a year ago in June, according to the median projection of 15 analysts polled by Reuters, compared to a 27.9 percent increase in May. According to the poll, imports likely increased 30.0 percent year over year in June, compared to 51.1 percent in May. China’s commerce ministry said on Friday that it anticipates goods trade to rise by 2% annually throughout the 14th five-year plan period, from 2021 to 2025, to $5.1 trillion. In a letter, Goldman Sachs analysts wrote, “The local epidemic of Covid-19 and accompanying viral control measures in the Guangdong region created delays around ports in Shenzhen and Guangzhou.” “In our opinion, this may have slowed trade growth by 2-3 percentage points in June. Global demand, on the other hand, remained stable and continued to sustain export growth.” In June, a measure of manufacturing activity in the United States reached a new high, while business growth in the Eurozone advanced at its quickest rate in 15 years. Exporters, on the other hand, are dealing with greater raw material and freight prices, as well as logistical difficulties. According to Frederic Neumann, an economist with HSBC, there are hints that production constraints in Asia are beginning to loosen. “However, that will not bring immediate relief: manufacturing elsewhere appears to be constrained, and there are still transportation repercussions to be addressed,” he said. Coal, steel, iron ore, and copper prices have soared this year, fueled by the lifting of pandemic quarantines in several nations and sufficient global liquidity. After a government crackdown on runaway commodity prices, China’s factory gate inflation dropped in June, but the annual rate remained uncomfortably high, underscoring the economy’s rising pressures as Beijing tries to buttress a post-coronavirus recovery. And, according to a private study, factory activity in China grew at a slower pace last month, as the reappearance of COVID-19 cases in the export province of Guangdong, as well as supply chain problems, reduced output growth to its lowest level in 15 months. According to the poll, the trade surplus will be $44.20 billion in June, down from $45.54 billion in May. The information will be made public on Tuesday. Gabriel Crossley contributed reporting, and Shri Navaratnam edited the piece./n
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