Russell: Hormuz's impact on China's commodity imports is evident in the oil and metals prices.
China's imports of commodities are being influenced by the Iran conflict. April data shows a sharp drop in crude oil, but a rise in trade in metals. Customs figures last week showed a sharp decline in crude oil arrivals, the lowest level in nearly four years.
Imports in April were down by?20% compared to the same period in 2025, as seaborne imports?declined dramatically?amid a sharp decline of Middle East imports?amid an effective closure of Strait of Hormuz following the U.S. attack on Iran on February 28, 2019.
According to Kpler's data, China only received 648,000 bpd through the Strait of Hormuz during April. This is down from the average of 4,07 million bpd for the three-month period from January to march.
The last tankers to leave the strait before the conflict began would have been those that left in March or April. However, some have managed to make it out of the waterway in recent weeks, despite the fact that both Iran and the United States have effectively declared the waterway closed.
When assessing China's crude imports, another factor to consider is price. The drop in April follows the pattern of past years of increasing imports as prices fall and decreasing arrivals as they rise.
The sharp increase in crude oil prices following the beginning of the conflict may have deterred China's refining companies from purchasing their usual volumes. This is especially true since the prices of physical cargoes rose to levels that were well above the futures prices over a period lasting several weeks.
Brent futures hit a 2026 peak of $126.41 per barrel on April 30. This is up 74% since the February 27 close of $72.48. Some physical cargoes were trading at a premium of about $40 to futures.
CHINA HELPS YOU?
The decline in China's crude oil imports helped to ease the squeeze on crude supplies in Asia. This was the destination of about 80% volumes that passed through the Strait of Hormuz before the war with Iran.
This is more a coincidence than a sign of China's altruism.
At least 1.2 billion barrels of crude oil are held in strategic and commercial stockpiles. It makes sense to reduce imports for China when the price is high, since it is widely expected that the prices will drop sharply if the strait reopens.
China would use its huge crude oil stockpile if it were altruistic to increase exports of refined fuels. Due to a shortage, diesel and jet fuel prices have reached record highs.
China's refined product exports fell to 3.1 millions metric tons in the month of April, a 33% drop from March, and their lowest level in over ten years, as Beijing chose to keep fuel on its domestic market.
There have not been any formal announcements about the relaxation of this informal restriction.
Beijing may have realized that fuel shortages among its neighbors will inevitably?blowback on its own economy. Or, refiners could be pushing to resume exports due to the high margins available, especially for middle distillates.
ALUMINIUM, IRON ORE
The increase in China's aluminium exports, which rose 15% from April last year to 598 tons, is likely due to higher profits.
Prices for aluminium in London jumped by 14% from the day before the Iran War began to $3,579.50 per ton on Monday, as the conflict reduced about 8% of the global supply coming from Middle East producers.
Iron ore is one commodity where China's imports have shown resilience. April's arrivals were 103.9 million tonnes, down from March's total of 104.74 millions, but up slightly on a daily basis, at 3.46 from 3.38.
Iron ore imports are not due to a rise in steel production, nor exports. Both are falling. Production was down 4.6% during the first quarter of this year and exports were down 9.7% for the first four month period compared with the same time in 2025.
It appears that China is stockpiling iron ore to increase its inventories, in case the shipping industry becomes restricted by a lack of fuel oil due to refineries in Asia struggling to find enough crude.
Iron ore stockpiles at Chinese ports
The record high was 166.9 millions tons in mid-March. However, even after the decline, the current level remains higher than any other point in time. It is also 14.2% more than the 141.3 tons of the same week last.
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These are the views of the columnist, who is also an author. (Editing by Christian Schmollinger).
(source: Reuters)
