WASHINGTON: China is stocking up on grains, metals and other commodities, providing a boost to industrial bulk shipping companies as Beijing braces for a potential new wave of supply-chain disruptions from rising Covid-19 infections among the country’s Western trading partners.
China is the world’s biggest commodity importer, making up roughly 40% of the dry-bulk shipping market, and its rebounding economy has been driving a surge in prices for industrial commodities, including copper, aluminum and cotton.
With China’s overall imports up 13.2% in September from the same month last year, shipping executives expect an increase in freight rates over the next year.
The growth comes despite the continuing tariff dispute with the U.S. and growing tensions with Australia, one of China’s biggest commodity trade partners. Beijing has slapped duties on Australian beef and barley exports and has been taking in fewer shipments of coal over the past month.
“China will push on with its stimulus efforts into next year and this will support dry-bulk rates,” said Peter Sand, Chief Shipping Analyst at industry trade body Bimco. “If the world doesn’t shut down again, there will be a global net restocking, which means more shipments.”
