China's Exports Gain Momentum in June as Tariff Deadline Looms

Beijing, July 14: China's export sector posted stronger-than-expected growth in June, while imports showed signs of recovery, as businesses raced to ship goods ahead of a key August deadline tied to a fragile tariff truce between Beijing and Washington.

According to customs data released on Monday, outbound shipments rose 5.8% year-on-year in June, outpacing the 5.0% increase forecast in a Reuters poll and improving on May’s 4.8% growth. Imports rebounded by 1.1%, reversing a 3.4% decline in the previous month, although slightly below economists’ projection of a 1.3% rise.

The data suggests firms are frontloading exports to mitigate potential disruptions should high tariffs—exceeding 100%—be reimposed if trade talks between the world’s two largest economies falter.

“There are some signs that frontloading demand is beginning to wane gradually,” said Chim Lee, Senior Analyst at the Economist Intelligence Unit.
“While frontloading ahead of the August tariff pause deadline is likely to continue, freight rates for China-bound shipments to the U.S. have started to decline,” he noted.

Lee also observed that export controls between the U.S. and China have eased notably, with trade conditions now resembling those seen in mid-April.

Trade ties appeared to stabilise in June following negotiations in Geneva, where U.S. and Chinese officials agreed to revive the truce that had been strained by recent export restrictions impacting critical supply chains. Among the key developments, China’s rare earths exports surged 32% month-on-month, indicating that agreements to unblock the flow of these strategic minerals may be yielding results.

However, growing uncertainties remain. U.S. President Donald Trump has expanded his global trade offensive, unveiling a 40% tariff on transshipped goods entering the U.S. via Vietnam — a route widely used by Chinese manufacturers to circumvent direct tariffs. Analysts warn this move could indirectly affect China’s export volumes and add further strain to an already delicate situation.

Additionally, Trump’s recent threat of a 10% tariff on imports from BRICS nations — including China — has intensified concerns in Beijing over the widening scope of U.S. protectionist measures.

China now faces a crucial August 12 deadline to reach a comprehensive agreement with the White House, one that could determine the future stability of cross-Pacific trade.

Complicating the diplomatic landscape further, tensions with the European Union have escalated. In the lead-up to a key summit later this month, Brussels has accused China of distorting global markets through industrial overcapacity and indirectly aiding Russia’s wartime economy.

Despite mounting external pressures, China recorded a trade surplus of $114.7 billion in June, a rise from $103.22 billion in May, reflecting the resilience of its export sector — at least in the short term.

As the deadline approaches, global markets remain watchful of developments that could reshape international trade dynamics in the months ahead.