China’s exports showed a significant rebound in October, according to data released by the General Administration of Customs of the People’s Republic of China (GACC) on November 7, marking the highest growth rate since July 2022.

The total export value, measured in USD, reached approximately $309 billion, reflecting a year-on-year increase of 12.7%, well above the previous month’s 2.7% growth. Imports totaled around $213.34 billion, representing a 2.3% year-on-year decline, which was a notable improvement compared to the 7.2% drop in the prior month. The trade surplus stood at $96 billion, the third-highest monthly record.

By destination, exports to the United States rose by 8.1% year-on-year, up 2.2% from the prior month, while exports to the European Union grew by 12.7%, driven in part by a rush to export ahead of anticipated trade barriers.

On the product level, crude oil imports declined by 9% year-on-year, marking the sixth consecutive month of decline, indicative of weak domestic demand. Steel exports surged by 24.4%, showing a 13.1% increase over the prior period, pointing to excess production capacity in China’s industrial sector. Electronic exports, China’s largest category to the U.S., increased by 13.7% year-on-year, expanding by 10.7% from the previous month, though mobile phone exports declined by 0.7%, the only decline within the electronics segment.

In summary, expectations of higher tariffs on Chinese goods by the incoming U.S. administration and rising trade barriers against Chinese steel and electric vehicles have driven Chinese exporters to accelerate shipments. While this may support GDP growth, reliance on exports alone is unlikely to resolve broader economic challenges.

November 8 marks the final day of the National People’s Congress Standing Committee session, with markets closely watching for potential policy measures aimed at boosting domestic demand.

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China’s CPI showed a slowdown in September, according to data released by China’s National Bureau of Statistics on October 13. The Consumer Price Index (CPI) rose 0.4% year-over-year, below both the previous month and the market expectation of 0.6%.

Breaking down the details, food prices increased by 3.3% year-over-year, up 0.5 percentage points from the previous month, contributing 0.66 percentage points to the overall CPI growth. However, non-food prices shifted from a 0.2% year-over-year increase to a 0.2% decline. Energy prices dropped by 3.5% (previously -2.0%), while service prices rose by 0.2% (previously 0.5%), reflecting lower energy prices due to base effects and reduced demand for accommodation services following the summer season.

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Overall, domestic demand in China remains weak. Excluding food and energy, core CPI grew by only 0.1% year-over-year, down 0.2 percentage points from the previous month. Additionally, the Producer Price Index (PPI) fell by 2.8% year-over-year in September, a wider decline than the previous month’s 1 percentage point drop, indicating rising deflationary pressures.

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On the same day, China’s General Administration of Customs released September trade data. Exports grew 2.4% year-over-year, down from 8.7% in the previous month and below market expectations of 6%. Imports rose by 0.3%, lower than both the previous month’s 0.5% growth and the market forecast of 0.9%, continuing to reflect weak domestic demand and increased trade barriers from other countries.

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While China announced large-scale monetary easing policies in mid-September, specific implementation plans for accompanying fiscal measures have yet to be unveiled. Given the persistent weakness in demand and challenges to future export growth, China faces significant difficulty in achieving its 5% GDP growth target for the year.

China’s Ministry of Commerce and General Administration of Customs announced on Friday that it is optimizing and adjusting the temporary export control measures for graphite materials, officially incorporating three high-sensitivity graphite items, previously under temporary control, into the dual-use export control list.

According to an announcement on the Ministry of Commerce’s website, China’s export control regulations have been modified to safeguard national security and interests. This move, approved by the State Council of China, aims to optimize and adjust the scope of items as per Announcement No. 50 of 2006, titled “Decision on the Implementation of Temporary Export Control Measures on Graphite-related Products by China’s Ministry of Commerce, National Defense Science and Technology Commission, and General Administration of Customs.” Consequently, export controls are imposed on some items.

Specifically, artificial graphite materials and their products with high purity (purity >99.9%), high strength (flexural strength >30Mpa), and high density (density >1.73g per cubic centimeter), as well as natural flake graphite and its products (including spherical graphite and expanded graphite), will require permits and cannot be exported without permission.

Simultaneously, temporary controls have been removed for five low-sensitivity graphite items mainly used in the national economic base industries, such as steel, metallurgy, and chemicals.

Graphite is used in the production of electric vehicle batteries. According to data from the U.S. Geological Survey, China is the world’s largest producer of graphite, accounting for 67% of the global supply of natural graphite.

A spokesperson for China’s Ministry of Commerce responded to inquiries about the export control policy regarding graphite materials, stating that this policy will officially take effect on December 1st. Prior notifications have been sent to concerned countries and regions.

The spokesperson emphasized that implementing export controls on specific graphite items is a common international practice. As the world’s largest producer and exporter of graphite, China has consistently fulfilled international obligations, including non-proliferation. In line with the need to safeguard national security and interests, China has lawfully imposed export controls on specific graphite items, including temporary measures on some graphite items.

In recent times, based on the Export Control Law, the Chinese government has conducted a comprehensive assessment of temporary control measures for graphite items and has made optimized adjustments to reflect a coordinated development and security control concept. This is advantageous for better adherence to international obligations, ensuring the stability and security of global supply chains, and safeguarding national security and interests. China’s export control adjustments are not targeted at any specific country or region, and items that comply with relevant regulations will be permitted for export.

（Photo credit: BYD）