CHINA'S COMMODITY CONSUMPTION
China consumes an ever increasing amount of natural resources as they feed their double digit GDP growth. This easily translates into the commodity markets, in which China has become a significant player. In light of the recent troubles in the financial markets, which originated in China, we decided to take a look into the scale of their international trade in selected commodities.
Copper is the best example of China's thirst for commodities. An astounding 27.3 percent of the world's copper production was exported to China in 2005, equating to 2.788 million metric tonnes or 358,031 future contracts. Soybeans and cotton have also been in large demand, as more than 13 percent of the world's production ended up in China in 2006 for each of those commodities. This equates to 228,913 contracts for soybeans and 148,320 for cotton. China also consumes 4.6 percent of the world's daily crude oil output, or about 3,525 contracts per day.
China's raw materials exports on the other hand are relatively insignificant. It is more likely than not that they will become importers of these commodities as well at some point in the near future. China exported 0.6 percent of all corn produced in 2006, which equates to 30,707 future contracts. It was also responsible for 0.5 percent of exports in swine meat (pork) and 0.3 percent in wheat. However, over the past 5 years China on average was a net importer of 604,000 tonnes per year of wheat.
