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Where's the data? Angst for commodities traders as China trade figures held in limbo

Published 01/06/2018, 13:24
Updated 01/06/2018, 13:30
© Reuters. Worker gestures as a crane lifts goods onto a cargo ship, at a port in Lianyungang
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By Chen Aizhu and Tom Daly

BEIJING (Reuters) - Commodities traders have been waiting more than a week for China to release overdue monthly import-export data, frustrating many market watchers and fuelling speculation about reasons for the delay.

The prolonged wait for final April commodities trade statistics from the world's top buyer of oil, metals and grains comes as negotiators from Washington gather in Beijing for a round of talks aimed at avoiding an all-out trade war.

The April data, initially due on May 23, will show the scale of market disruptions since Washington and Beijing embarked on escalating tit-for-tat tariff threats, roiling flows of commodities such as soybeans, sorghum and corn.

Traders were hoping to glean from the final April data signs that China had stopped buying American agricultural goods, or started to switch to buying more from other countries, such as Brazil, Russia and Australia.

The company which collates and sells the data, China Cuslink Co Ltd, which is operated by customs, was ordered to delay publication indefinitely due to technical reasons, three officials at the company told Reuters.

One said the instructions came from customs, while another said it was from another government agency. The officials, who declined to be identified, gave no further details.

A spokesman for General Administration of Customs confirmed the suspension, but gave no reason.

While the timing of the delay may be coincidence, some traders speculated Beijing may want to conceal statistics that could somehow undermine its negotiating stance.

But Michael Mao, senior energy analyst in Shandong province at China Sublime Information Group, doubted there was a link.

"If Beijing wants to adjust the April data to sweeten trade talks, it won't work for obvious reasons," Mao said. "If the official data and shipping data don't match, analysts are smart enough to tell that authorities massaged official data."

Companies like Thomson Reuters and other media companies and consultancies pay to receive the final statistics, which give a breakdown by import origin and export destination for everything from sorghum to natural gas and steel.

Mao said speculation had circulated in the market that Beijing was considering stopping the sale of the data to some companies. Reuters was not able to verify this.

Traders and analysts seeking to use the data to devise trading strategies expressed frustration at the delay and lack of information. "It is such nonsense to delay the data for political reasons," said one veteran Beijing-based oil trader, who declined to be identified as he is not authorised to speak to the media.

NOT UNUSUAL

It's not unusual for statistical releases to be postponed by a day or two, and many analysts and trade experts have anyway long questioned the accuracy of official Chinese economic data.

The delay also comes as China's customs department undergoes a major overhaul, taking on extra functions, including import safety, which was previously handled by a separate agency, as part of a broader effort to make policymaking more efficient.

Still, an indefinite delay without a clear explanation is extremely rare, experts say.

Preliminary numbers showing total imports and exports earlier in the month revealed upheaval in flows of grains, such as sorghum, which were temporarily hit with anti-dumping sanctions by China.

The wait for the data comes as U.S. Commerce Secretary Wilbur Ross heads to Beijing for talks aimed at narrowing China's $375 billion (282 billion pounds) trade surplus, an effort Washington hopes results in China significantly ramping up purchases of American farm products and energy.

Ross is due in Beijing on June 2 to 4. On Wednesday, a delegation of more than 50 U.S. officials arrived in the Chinese capital for talks, according to China's commerce ministry.

Michael Lion, a China metals industry veteran who is president of Lion Consulting Asia in Hong Kong, said the delay may be a strategic decision while trade talks continue.

"It would be consistent from my experience for (the Chinese authorities) to withhold information that they might believe could be used by counterparties in negotiations," Lion told Reuters by email.

© Reuters. Worker gestures as a crane lifts goods onto a cargo ship, at a port in Lianyungang

Some market participants are resigned to a long wait, as the veteran oil trader noted: "Customs will probably delay the data until China solves the trade dispute with the U.S."

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