China has entered the world’s second largest economy, an indefinite position in 2025. Exports are moving forward, while imports have fallen unexpectedly, leading to China’s trade surplus that exceeds predictions. This transfer raises important questions about business dynamics underlying economic trends. Are these numbers indicating deep structural issues, or are they temporary ups and downs? In addition, the implications are spread beyond China, affecting global markets, supply chains and economic stability. As the world looks closely, the real question remains: what do these business figures really reveal, and how important is their impact on the broad global economy in the coming months?
China’s Exports: Growth, but Not Enough
Exports from China went up by 2.3% year-on-year in the first two months of 2025. While any growth is a positive signal, this figure pales compared to the 10.7% expansion recorded in December 2024. Moreover, it failed to meet economists’ expectations of a 5% increase. While manufacturing is still the biggest game in town, the speed at which the goods are shipping to stores overseas is slowing down.
China’s Trade relations continue to be a tightrope act, especially with the U.S. and the European Union. Exports to the United States saw a 2.3% increase, while shipments to the EU inched up by 0.6%. And Japan, a key trading partner who we’d look up to for more big business transactions, saw import levels from China increase just a little bit, only a little over half a percent. Surprisingly, exports to Russia tumbled by 10.9%, a decline that raises eyebrows given the strengthened ties between Beijing and Moscow in recent years.
China’s Imports: A Deep and Unanticipated Dive
So if the export slowdown was worrisome, having such a large drop at 8.4% year over year in imports was an even bigger shock. Economists had expected a 1% increase, making the contraction an unexpected setback. This drop could indicate faltering demand at home, manufacturing slowing down, or disruptions to supply chains which then block materials from getting into production.
A closer look at commodities reveals a more nuanced picture:
- Soybeans: Imports increased by 4.4% to 13.61 million metric tons, a promising sign for global agriculture markets.
- Coal: We’re seeing a small bump of just 2.1% to about 76.12 million metric tons this year, and it seems this could have something to do with China’s current focus on ensuring energy security.
- Iron ore: A big drop of 8.4 percent, now to 191 million metric tons which happened because of major supply disruptions in both Australia and Brazil.
- Crude oil: Imports dropped by about 5%, to 83.85 million metric tons last year likely caused by U.S. sanctions and port congestion at Shandong Harbour.
- Unwrought copper: A sharp 7.2% decline to 837,000 metric tons, as China ramps up domestic smelting capacity.
China’s Trade Surplus: A $170 Billion Windfall?
Despite sluggish trade activity, China’s trade surplus surged to 170 billion. This surplus reflects China’s resilience in exporting more than it imports, but it also signals a potential demand weakness within the country.
Factors at Play: The Global Chessboard
Trade Tensions with the U.S. The shadow of new 10% tariffs imposed by the U.S. looms large, as China retaliates with levies of its own. This geopolitical chess game has added uncertainty to global markets.
Despite efforts by the government, consumer spending in China has stayed pretty flat which is making imports not bounce back too much.
Commodity-Specific Setbacks- Supply chain bottlenecks, weather disruptions in key exporting nations, and sanctions have all played a role in suppressing China’s commodity imports.
Will that be enough to make imports stronger and keep exports going strong?
For now, China remains locked in a delicate balancing act—navigating a world of trade tensions, shifting economic tides, and evolving global supply chains. So the next few months are vital to understand whether manufacturing across the globe gets its mojo back or if things start slowing down even more.
