* Iron ore, soy imports surge on price decline
* Crude oil, copper, coal imports slow
* Net steel, oil trade flows point to weak underlying demand
By David Stanway
BEIJING, Aug 8 China's imports of iron ore and
soybeans maintained their upward trajectory in July but
shipments of crude oil, copper and coal dropped, underscoring
the relatively sluggish domestic demand in the world's
Copper shipments fell 2.9 percent compared to June, coal
imports dropped 8.1 percent and crude oil imports slid 1.1
percent to their lowest daily rate since March, but July
deliveries of iron ore surged 10.7 percent and soybeans rose 17
percent on the month, customs data showed on Friday.
The rise in imports of both iron ore and soybean, however,
was attributed by analysts to opportunistic buying on favourable
price moves, with subdued domestic demand seen potentially
driving a surge in the stockpiles of both the commodities.
"We had expected imports (of iron ore) to slow down because
port inventory remains high, but I think the price decline in
June triggered some increase in bookings for seaborne cargoes
and steel producers took that opportunity to stock up on some
high-quality iron ore," said Helen Lau, analyst at UOB-Kay Hian
Securities in Hong Kong.
Data from the General Administration of Customs on Friday
showed that China's overall exports jumped 14.5 percent in July,
far higher than anticipated, but imports fell 1.6 percent year
on year after rising 5.5 percent in June, suggesting that
overall domestic demand remains sluggish.
The record trade surplus was reflected in China's oil flows,
with net oil product exports reaching 101,613 barrels per day,
the highest level this year. China imported 1.86 million tonnes
of oil products in July and exported 2.31 million tonnes,
customs data showed.
"The decline in crude imports was surprising, and combined
with net product exports suggests that domestic product oil
demand was particularly weak in July," Citigroup said in a note.
Chinese steel product exports also continued to rise in
July, up 14 percent on the month at 8.06 million tonnes.
Citigroup said that implied steel demand actually fell 3.4
percent on a monthly basis in July, and domestic mills were
becoming increasingly dependent on overseas markets, with the
share of net exports in overall steel production now at 9.5
percent, its highest since 2008.
"This share is likely near the peak," it said, especially in
the face of growing trade sanctions as foreign markets take
action against cheaper Chinese supplies.
Purchases of iron ore remained at a high level despite
soaring stockpiles and a relatively weak domestic steel sector,
with buyers still attracted by bargain prices. Shipments in July
rose to 82.52 million tonnes, the third highest on record.
Port stockpiles fell for two consecutive weeks to reach
111.95 million tonnes by August 1, but they remain 46 percent
higher than at the same time last year, according to data from
Soybean imports reached 7.47 million tonnes, up 17 percent
compared to June, thanks to a 10 percent fall in prices that
eased some of the margin pressures on domestic crushers.
But the China National Grains and Oils Information Center, a
government-backed think-tank, said inventories of imported
soybeans reached 6.3 million tonnes at the beginning of August,
up about 300,000 tonnes in just a week and its highest level
since September last year.
(Additional reporting by Manolo Serapio Jr. in SINGAPORE;
Reporting by China Commodities and Energy Team; Editing by