China’s Exports Fall to Lowest Level Since February Amid Global Trade Slowdown

China's exports unexpectedly fell in October as purchasers waited to see how a tumultuous month in US-China trade relations would unfold and as foreign orders tapered off after months of front-loading to avoid President Donald Trump's tariffs. According to Customs statistics released on November 7, outbound shipments from China decreased 1.1% in October, the lowest level since February.

This was in contrast to an 8.3% increase in September and fell short of a 3% growth prediction in a Reuters poll. The result was impacted by a high base from last October, when companies started shipping inventory to major countries in anticipation of Trump's victorious return to the White House, causing exports to grow at their quickest rate in more than two years.

Sharp Decline in Shipments to Various Countries

In October, shipments to the US fell by slightly more than 25%, while shipments to the EU increased by 1%, the least amount since a decline in February. Sales to South Korea, Russia, and Canada all experienced double-digit declines in exports to a few other important markets. The smallest growth since February was seen in shipments to all countries save the US, which increased 3.1% from a year ago. Compared to a 7.4% gain in September and a 3.2% predicted increase, imports increased by a much slower 1%.

According to preliminary data, the economy slowed down a little in October. Factory owners reported a significant decline in new export orders, and the official purchasing managers' index dropped to a six-month low, indicating that the global market had already consumed all of the Chinese goods it could for the time being.

Early in October, tensions between the US and China unexpectedly increased when Trump threatened to impose 100% taxes on Chinese goods in retaliation for Beijing's expansion of its export restrictions on rare earth metals. After he met with President Xi Jinping in South Korea last week, the two sides decided to extend their trade truce, which was originally set to conclude on November 10th, for an additional year.

China Creating Roadmap to Dodge US’ Tariff Plan

In an effort to counteract the impact of Trump's tariff assault, China has attempted to diversify its export markets in 2025, but exporters say they frequently sell to countries with lower profit margins in order to protect market share. The nation's growing trade surpluses with other nations have increased pressure on manufacturers and prompted protectionist backlash due to worries that its low-cost products may oversupply other markets.

This week, China unveiled a plan to boost imports with the goal of becoming "the best export destination" and "opening up win-win cooperation". Still, a barrier is the lack of domestic demand. After a major meeting of the Central Committee of the ruling Communist Party outlined economic and policy objectives for 2026 to 2030, officials said in October that China would seek to increase the share of GDP from family consumption "significantly" during the following five years. China's October trade surplus was US$90.07 billion (S$117.5 billion), down from US$90.45 billion the previous month and falling short of the US$95.6 billion expectation.