China’s exports to the United States plunged 33% in August compared to a year earlier, as tighter scrutiny on rerouted shipments and fading effects of frontloaded exports weighed on trade.
Imports from the US also fell 16% during the same period, underscoring the continued strain in the world’s largest bilateral trading relationship.
Overall, China’s exports grew 4.4% in August to $321.8 billion, customs data showed Monday.
The pace was slower than July’s 7.2% expansion and marked the weakest growth in six months. Imports rose 1.8% to $219.5 billion, also missing market forecasts of stronger momentum.
Growth eases after strong base last year
Economists noted that part of the slowdown reflected a high comparison base.
Zichun Huang, China economist at Capital Economics said exports were little changed on a seasonally adjusted basis, with the slowdown mainly reflecting last year’s strong performance.
The weaker-than-expected figures come as President Donald Trump intensifies tariffs on goods routed through third countries, a tactic many Chinese exporters had relied on to bypass US duties.
Washington in July imposed a 40% tariff on shipments deemed transshipped, adding pressure on trade flows.
Diversifying markets provide some cushion
While shipments to the US shrank sharply, exports to other regions grew robustly.
Exports to the European Union rose 10.4% in August, while those to the Association of Southeast Asian Nations surged 22.5%. Shipments to Africa expanded nearly 26%.
“Chinese exporters have been pushing for higher market share in other countries due to weak domestic demand in China. This ‘going abroad’ initiative likely contributed to the resilience of Chinese exports so far this year,” said Zhiwei Zhang, president and chief economist at Pinpoint Asset Management.
From January through August, China’s exports to the US fell 15.5% from a year earlier, while imports dropped 11%.
Over the same period, shipments to the EU climbed 7.7%, to ASEAN 14.6%, to Africa 24.6% and to Latin America nearly 6%.
Still, the US remains China’s largest single-country trading partner, absorbing $283 billion of Chinese goods this year as of August.
Trade truce offers little relief
Beijing and Washington extended their tariff truce by 90 days on August 11, maintaining US tariffs of around 55% on Chinese imports and 30% Chinese duties on American goods.
However, the latest round of talks in Washington ended with little progress, with Trump warning of tariffs as high as 200% if China fails to boost rare-earth exports.
China’s rare-earth shipments rose 22.6% in August to 5,791.8 metric tons, though analysts warn that the sector remains vulnerable to policy uncertainty.
Exports likely to remain under pressure
Despite the resilience in non-US markets, the outlook for China’s trade remains clouded.
A struggling property sector, weak domestic demand, and rising US scrutiny on transshipments may weigh on export momentum in coming months.
“With the temporary boost from the US-China trade truce fading and the US raising tariffs on shipments rerouted via other countries, exports are likely to come under pressure in the near term,” said Zichun Huang, China economist at Capital Economics said in a note.
With China still dependent on the US as a critical market, the widening trade rift threatens to keep global supply chains on edge even as Beijing deepens ties with alternative partners.
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