The hottest supply side reform in China has booste

China's supply side reform has boosted global demand. Commodities reappear at China's moment

the latest data released by the General Administration of Customs showed that in the first three quarters, the volume and price of China's bulk commodities increased at the same time in terms of imports. Among them, the import of iron ore, crude oil and soybeans increased significantly

analysts believe that the increase in bulk commodity imports is mainly due to the improvement of China's real economy, and China's supply side reform and other measures have boosted the overall demand of the international market. In addition, the import and export trade between China and countries along the "the Belt and Road" increased by 20.1% in the first three quarters, higher than the growth rate of China's foreign trade in the same period. The main moving parts are made of wear-resistant materials. Under the background of improving supply and demand, bulk commodities have rebounded sharply after June. How long can the above factors support commodities

China's supply side reform boosted global demand

data released by the General Administration of Customs showed that China's import volume and price of bulk commodities such as iron ore, crude oil and natural gas rose in the first three quarters of this year. Among them, imported natural gas increased by 22.3%, iron ore increased by 7.1%, crude oil increased by 12.2%, soybeans increased by 15.5%, and refined oil increased by 4.2%. In addition, China's import prices rose by 10.6% on the whole

this year's commodity bull market and the vigorous resonance of import and export are familiar

as early as 2002 to 2012, there was a ten-year bull market in the bulk commodity market. At that time, in the international bulk commodity market, the phenomena of "China moment" and "China price" were significant. Since 2016, bulk commodities have gone out of two waves of obvious rebound. What is the impact of Chinese factors behind this "commodity bull"

taking September as an example, the data showed that China's total import and export (RMB) in September increased by 13.6% year-on-year, hitting a new high since July 2017. Among them, exports increased by 9% and imports increased by 19.5%. In terms of price, the average price of imported iron ore in September was $70.3/ton, a sharp increase of $6.4 from the previous month, up 10% month on month; The average price of imported crude oil was $367.5/ton, a sharp increase of $21.3 over the previous month

Monita Zhong Zhengsheng, Zhang Lu and Yan Li believed that the growth rate of China's import and export both rebounded, but the import rebound was significantly greater than that of exports, or it indicates that the overall economic demand is still stable. In addition, the "import substitution" caused by environmental protection and supply side reform has also significantly increased the import volume of major bulk commodities such as iron ore, steel and copper

"in terms of exports, exports are expected to rise at the end of the quarter, but the range is less than market expectations, which is mainly dragged down by the export of labor-intensive products, which just shows that environmental protection controls production and restricts export supply; in terms of imports, China's imports have frequently exceeded market expectations this year, which shows that China's supply side management is providing demand for the world." Industrial Research jiangdongying and Li Miaoxian pointed out

taking iron ore as an example, in September, the imported iron ore exceeded 100 million tons for the first time, reaching 103 million tons, the highest monthly record since the import of iron ore. Wei Wei, an analyst at Ping An Securities, believes that domestic environmental protection production restrictions in winter have led to a substantial increase in the demand for high-grade overseas ores by domestic enterprises, especially those in the production restriction area

it is understood that most of China's domestic iron ore resources are of low grade, but the cost is higher than that of foreign countries

"In recent years, domestic blast furnaces have become increasingly large-scale, and the demand for large blast furnaces for iron ore is more refined, so the demand for high-grade imported ore has greatly increased. September is the last gap period before the implementation of environmental protection production restriction measures. Friendship tips: if there are unclear local iron and steel enterprises will have the willingness to prepare more goods in advance to deal with environmental protection production restriction. A large number of imports also led to the month on month rise in the price of imported ore in September. The average customs price of imported ore in September was $70.29/ton , a month on month increase of $6.4/ton. " Wei Wei said that in the later stage, it is expected that the single month import volume of iron ore will decline, but the overall demand will remain high

lianxun securities analyst Chen Yong pointed out that since the second half of last year, the global economy has continued to recover, especially the simultaneous strengthening of the European and American economies, which has significantly improved China's export situation, and this trend is still continuing

commodities reproduce the "China moment"

the world is as cool and hot as this. In terms of varieties, steel, coal and nonferrous metals, the key areas affected by this round of supply side reform and environmental protection and production restriction, are the "leaders" of this round of commodity rebound. The Chinese market has become the most prominent factor in the pricing of bulk commodities at this stage

an investor engaged in the trading of iron ore futures in the outer market told the China Securities Journal that in the past two years, almost all of them have to look at the "inner market" and do the "outer market"

since 2016, a number of international bulk merchants 3 have improved and improved the futures varieties of plastic recycling and processing technology products to reproduce the "China moment", that is, their prices often follow China's internal market in the Asian period, and another situation occurs in the local period. For example, in the nonferrous metal bull market in 2016, LME multi metal prices "followed" China's prices during the Asian period, but began to callback during the London period

a senior trader said that whenever there is a "China moment" in bulk commodities, prices will rise sharply. The reason is closely related to the change of China's import and export status in the world. Since becoming a net importer of crude oil in 1993, China has gradually become a net importer of many bulk commodity raw materials at a price of about 2000 yuan/ton before 2010. Under the huge demand, Chinese demand is deeply participating in the global pricing mechanism. The emergence of "China moment" in the commodity market is based on this trade pattern

according to the introduction, from the perspective of global manufacturing industry, the industrial system of China's manufacturing industry is the most perfect. In a total of 31 categories, Chinese enterprises are involved, which is more sound than the United States and Japan; In terms of industrial scale, China surpassed the United States in 2010, and its manufacturing output scale ranked first in the world; In terms of products, China ranks first in the world in terms of more than half of the world's more than 500 statistical industrial products

in terms of bulk commodities, China's imports are mainly reflected in three areas: first, basic metals and ores, such as copper, nickel, iron ore, etc; Second, agricultural products [stock evaluation], such as soybeans and corn; Third, energy and chemical products, such as oil, coal, PTA, natural gas, etc

since the beginning of this year, China's import frequency has exceeded market expectations, and the data in 9 months and 7 months have exceeded market expectations. What does such beautiful import data mean

Jiang Dongying and Li Miaoxian pointed out that China's supply side management is providing global demand, mainly in the following two aspects. First, China has constrained export growth through supply side reform, environmental protection and production control, thereby curbing China's consumption of global demand. Second, on the premise that the growth rate of domestic investment and consumption has not declined significantly, the supply-demand gap constrained by supply side reform and environmental protection production restriction will be filled by imports. In addition, supply side management has pushed up domestic prices, thereby lowering the internal and external price differences, and even led to the upside down of the domestic and external price differences of some commodities, which has stimulated traders' import hoarding behavior

where to go in the fourth quarter

how will commodities perform in the fourth quarter under the influence of Chinese demand

"in terms of demand, we believe that domestic demand will show strong resilience in the fourth quarter. The high growth of industrial enterprise profits will gradually release production capacity, and industrial growth is expected to rebound." Lianxun Securities said

it is worth noting that the high base in the fourth quarter of last year may cast a shadow on the subsequent trade growth

Monita research believes that there is no need to dwell too much on the short-term fluctuations of data. Driven by the "the Belt and Road" initiative, China's trading partners are further diversified and the trade structure is further improved, which will lay a good foundation for the long-term improvement of China's foreign trade competitiveness

"the trade performance in September once again enhanced the optimism of the macro economy, and the internal and external demand resonated well, which also provided a substantial basis for future economic growth. The improvement of trade and the underlying enthusiasm for production and investment were steadily repaired. Coupled with the protection of the trade environment and the domestic macro environment, we adhered to the optimism of the real economy." Xu Jun, an analyst at Northeast Securities [Stock review], said

in terms of specific investment, Wei Wei suggested that investors should pay attention to the performance of listed companies with large proportion of high value-added products, high self-sufficiency rate of iron ore in TISCO, and high proportion of high-end product exports, as well as stocks that are expected to directly benefit from environmental protection and production restriction in the heating season and have greater performance flexibility