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Economy

China’s Commodities Imports Ease in June on Sluggish Economy

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(Bloomberg) — China’s appetite for commodities eased in June, as a sluggish economy took the edge off import demand across a number of key raw materials.

Over the first six months of 2024, the world’s top importer bought less crude oil, soybeans, edible oils, meat and rubber, compared to last year. That’s unusual in markets that often see record demand each year as China’s economy expands. Some metals imports have also started to slow, while growth in coal purchases has weakened substantially.

China’s economic growth likely weakened in the second quarter, with the downturn in the property market, fiscal strains at the local government-level, and increasing trade protectionism around the world, leading a daunting set of challenges for policymakers to consider at next week’s Third Plenum in Beijing.

Energy Products

Crude oil imports in June fell on both a monthly and annual basis to 46.45 million tons, in line with indications that the rapid take up of electric vehicles means Chinese demand may already have peaked. Over the year to date, shipments are 2.3% lower than last year.

Purchases of power plant fuels have held up better, despite ample inventories and a rising contribution from hydropower and other renewables, as China continues to prioritize security of supply. In June, coal imports climbed on both a monthly and annual basis to 44.6 million tons, while natural gas held above 10 million tons for an eighth consecutive month.

Coal imports have risen 13% over the year so far, well below the 93% growth recorded in the first six months of 2023.

Metals Markets

Iron ore imports dipped below 100 million tons for the first time in four months as cash-strapped steel mills scaled back purchases. Exports of the alloy, a key channel for mitigating soft domestic consumption, also eased, falling below 9 million tons for the first time since February.

China’s unwrought copper purchases slipped to a four-month low after record international prices in May suppressed already weak demand. Concentrate imports increased, however, despite tighter global supplies as smelters continued to expand capacity.

Aluminum exports rose to near a two-year high as overseas demand for the metal picked up despite a narrowing in the premium on outbound shipments.

Farm Goods

Soybean purchases in June climbed above 11 million tons, the highest in over a year, as traders took advantage of cheaper Brazilian beans. But for the half-year, they’re still 2.2% off last year’s pace. Imports of other agricultural goods continued to show weakness as a slowing economy saps consumption.

–With assistance from Winnie Zhu, Kathy Chen, Audrey Wan and Hallie Gu.

 

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Economy

PBO projects deficit exceeded Liberals’ $40B pledge, economy to rebound in 2025

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OTTAWA – The parliamentary budget officer says the federal government likely failed to keep its deficit below its promised $40 billion cap in the last fiscal year.

However the PBO also projects in its latest economic and fiscal outlook today that weak economic growth this year will begin to rebound in 2025.

The budget watchdog estimates in its report that the federal government posted a $46.8 billion deficit for the 2023-24 fiscal year.

Finance Minister Chrystia Freeland pledged a year ago to keep the deficit capped at $40 billion and in her spring budget said the deficit for 2023-24 stayed in line with that promise.

The final tally of the last year’s deficit will be confirmed when the government publishes its annual public accounts report this fall.

The PBO says economic growth will remain tepid this year but will rebound in 2025 as the Bank of Canada’s interest rate cuts stimulate spending and business investment.

This report by The Canadian Press was first published Oct. 17, 2024.

The Canadian Press. All rights reserved.

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Economy

Statistics Canada says levels of food insecurity rose in 2022

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OTTAWA – Statistics Canada says the level of food insecurity increased in 2022 as inflation hit peak levels.

In a report using data from the Canadian community health survey, the agency says 15.6 per cent of households experienced some level of food insecurity in 2022 after being relatively stable from 2017 to 2021.

The reading was up from 9.6 per cent in 2017 and 11.6 per cent in 2018.

Statistics Canada says the prevalence of household food insecurity was slightly lower and stable during the pandemic years as it fell to 8.5 per cent in the fall of 2020 and 9.1 per cent in 2021.

In addition to an increase in the prevalence of food insecurity in 2022, the agency says there was an increase in the severity as more households reported moderate or severe food insecurity.

It also noted an increase in the number of Canadians living in moderately or severely food insecure households was also seen in the Canadian income survey data collected in the first half of 2023.

This report by The Canadian Press was first published Oct 16, 2024.

The Canadian Press. All rights reserved.

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Economy

Statistics Canada says manufacturing sales fell 1.3% to $69.4B in August

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OTTAWA – Statistics Canada says manufacturing sales in August fell to their lowest level since January 2022 as sales in the primary metal and petroleum and coal product subsectors fell.

The agency says manufacturing sales fell 1.3 per cent to $69.4 billion in August, after rising 1.1 per cent in July.

The drop came as sales in the primary metal subsector dropped 6.4 per cent to $5.3 billion in August, on lower prices and lower volumes.

Sales in the petroleum and coal product subsector fell 3.7 per cent to $7.8 billion in August on lower prices.

Meanwhile, sales of aerospace products and parts rose 7.3 per cent to $2.7 billion in August and wood product sales increased 3.8 per cent to $3.1 billion.

Overall manufacturing sales in constant dollars fell 0.8 per cent in August.

This report by The Canadian Press was first published Oct. 16, 2024.

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