China Economy, Construction & Lumber Shipments
- GDP growth in Q3 is 6.8% (YOY), maintaining strong growth between 6.7% to 6.9% consecutively for 9 months.
- Consumption is 64.5% of GDP, increased by 2.8% compared to 2016.
- Fixed-asset investment in Q1-3 is 45,847.8 billion RMB, grew 7.5% (YOY).
- Investment in real estate development in Q1-3 is 8,064.4 billion RMB, grew 8.1%. New construction started over Q1-3 is 1,310 million m2 (floor space), grew 6.8%.
PMI (Caixin) indexes dropped to 51.0 in September 2017 from 51.6 (August) which was the weakest expansion since this June due to the slow growth of output, new orders and export sales in the past three months[ii].
China Consumer Price Index (CPI) has increased 1.6% year-on-year in September compared to the 1.8% rise in August and both under 3% which is Beijing’s 2017 target.[iii] USD/CNY decreased continuously from 6.78(July 1st) to 6.72 (August 1st) to 6.56 (September 1st) and slightly came back to 6.65 (October 1st) [iv]; CAD/CNY fluctuated from 5.23 (July 1st) to 5.35 (August 1st) to 5.29 (September 1st) to 5.34 (October 1st)[v].
Building material prices
Cement price moved from RMB 308.33 to RMB 320.00 per metric ton (up 3.78%%) over September [vi]; Rebar steel price dropped by 3.89% from RMB 4,049.33 per metric ton on September 1st to RMB 3,892.00 per metric ton on September 30th [vii].The log price index in September was 1,106.30 which increased 1.81% more than this August and grew 5.54% YoY; the lumber price index in September was 1,102.98 with 0.85% growth MOM and 1.89% growth YoY[viii].
Wood import of China[ix]
From January to August 2017 the forestry fixed asset investment was worth RMB 144.89 billion which increased 7.1% year-on-year. During the same period around 7.76 million m3 of Russian wood were imported through Manchurian Port with 8.1% growth year-on-year. In the second quarter of 2017 the Swedish softwood lumber inventory was predicted to be 2.1 million m3 with a 21% decreasing year-on-year. Canadian lumber output was 5.2 million m3 in July 2017 which showed -1.9% year-on-year and -9.1% month-on-month; its lumber shipment quantity was 5.5 million m3, down 0.8% year-on-year and down 5.2% month-on-month.
[i] Yawen Chen and Ryan Woo (October 4th, 2017). China September data to show steady growth ahead of key Communist Party congress
[viii] BOABC (September 2017). China Wood and Its Products Market Monthly Report
[ix] BOABC (July to September 2017). China Wood and Its Products Market Monthly Report