Preview: China iron ore, crude imports seen up in Nov on restocking

China iron ore

China's imports of crude oil and iron are expected to rise in November as refineries raise runs and steel mills restock, but an uncertain economic outlook continues to hold back purchases of a range of commodities.

The pace of activity in China's vast manufacturing sector quickened for the first time in 13 months in November, a survey of private factory managers found, adding to evidence that the economy is reviving after seven quarters of slowing growth.

But the survey also showed that demand remained lacklustre and that there were worrying signs that China was still relying too much on state-led investment to revive the economy rather than the private sector.

"The major driver right now lies only in the expectations of traders and they are not very keen to increase inventories right now because of cash issues," said Henry Liu, head of commodity research at Mirae Asset Securities in Hong Kong.

"There is no catalyst right now. Everyone thinks commodities are cheaper but where is the catalyst?" he said.

With supplies tight, Chinese soy crushers are also under pressure to buy as demand peaks in December and January, but poor margins make a big November jump in imports unlikely. It is too early to point to a recovery in copper demand, with any increase in November volumes down to a shipment delay brought about by the weeklong October National Day holiday.

"The rise will have nothing to do with domestic demand," said Zhou Jie, an analyst at China International Futures.

Overall foreign trade is likely to remain weak, with a Reuters poll showing export growth might have slowed to 9 percent from 11.6 percent in October, with imports also easing to 2 percent from 2.4 percent. Still, traders suggested that sentiment is steadily improving, and there are signs that industrial activity is also on the road to recovery.

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