China trade surplus passes $1tn as October exports and imports soar

China's trade surplus has broken through the $1 trillion mark for the first ten months of the year, driven by resilient overseas demand for technology hardware and a sharp acceleration in domestic commodity imports.

Official figures published on Tuesday showed goods exports grew 35.2 per cent in October compared to the same month last year. That comfortably beat consensus forecasts of 33.5 per cent, though it marked a slight easing from September's 36.3 per cent rise. Imports expanded even faster, jumping 41.6 per cent year-on-year against expectations of 32 per cent.

Because incoming shipments grew so sharply, China's monthly trade surplus narrowed to $105.3 billion in October—the lowest monthly gap since April. But the cumulative total for 2026 reached $1.04 trillion, putting the country on track to rival the record $1.2 trillion surplus recorded across the whole of 2025.

What drove the surge in imports

Energy supplies and high-tech equipment accounted for the bulk of the surge in imports. Calculations based on official customs data show incoming shipments of high-tech products jumped 72 per cent by value. Crude oil imports rose by around 41 per cent, liquefied natural gas climbed 50 per cent, and coal imports surged 60 per cent.

Tianchen Xu, senior economist at the Economist Intelligence Unit, said the import expansion was primarily propelled by appetite for technology components, energy reserves, and industrial minerals such as copper.

How trade played out with major partners

On the export side, Chinese manufacturers continued to capitalise on global demand for semiconductor chips and artificial intelligence hardware. Shipments to the United States grew 32.9 per cent by value, while imports of American goods rose nearly 35 per cent, generating a bilateral monthly surplus of $32.7 billion.

Trade with the European Union showed a different pattern. Chinese exports to the bloc climbed 24.4 per cent, but imports from Europe dropped more than 4 per cent, leaving China with a $33.4 billion monthly surplus.

What happens next on international policy

The growing trade gap has renewed friction with major commercial partners. European regulators agreed last month to cap imports of Chinese hybrid vehicles at 350,000 units per year starting 1 December. However, Brad Setser, a senior fellow at the Council on Foreign Relations, noted that the cap exceeds the 300,000 hybrids China shipped to Europe last year, suggesting the measure will do little to alter broader trade balances.

Internal economic indicators remain mixed. While export manufacturing continues to provide policy headroom for Beijing to pursue its annual growth target of 4.5 to 5 per cent, domestic consumer spending remains muted. Official data showed retail sales grew 1.1 per cent in September, while factory purchasing managers' index data for October indicated a slight contraction in manufacturing activity as new orders cooled.