China

Gregory LaRocca
(202) 205-3405
Gregory.LaRocca@usitc.gov

  To view changing data, hover over or touch the animated graphic below.

Change in 2017 from 2016:

• U.S. total exports to China: Increased by $14.8 billion (12.8 percent) to $130.4 billion
• U.S. general imports from China: Increased by $43.0 billion (9.3 percent) to $505.6 billion
• U.S. trade deficit with China: Increased by $28.2 billion (8.1 percent) to $375.2 billion

U.S. Total Exports

U.S. total exports to China rose 12.8 percent to $130.4 billion in 2017. U.S. exports for most industry sectors increased, with major factors including the expansion of the Chinese economy by 6.9 percent in 2017,^[1] relaxed U.S. regulation of crude petroleum exports, and increased U.S. natural gas export capacity.^[2]

The largest U.S. export sector shift occurred in energy-related products, whose value surged by $6.0 billion (199 percent) to $9 billion in 2017 (table CHI.1).  Within this sector, the value of U.S. exports of crude petroleum grew by 1,130 percent, rising by $4.1 billion to $4.4 billion. By volume, U.S. exports of crude petroleum increased by 1,064 percent from 7.4 million barrels in 2016 to 78.7 million barrels in 2017.  On December 18, 2015, the U.S. Congress lifted crude petroleum export restrictions,^[3] and U.S. exports of crude petroleum to China have subsequently accelerated.^[4]

Exports of natural gas and components also grew strongly, increasing by $1.3 billion (117 percent) to $2.5 billion. Increased infrastructure and export capacity at Cheniere’s Sabine Pass liquefaction terminal in Louisiana, as well as rising demand, supported a 26.9 percent increase in U.S. natural gas exports to China (to 68.6 million tons).^[5]

Table CH.1: China: U.S. total exports, general imports, and merchandise trade balance, by major industry/commodity sectors, 2013–17

Source: Compiled from official statistics of the U.S. Department of Commerce.
Note: Import values are based on customs value; export values are based on free along ship value, U.S. port of export. Calculations based on unrounded data. Sectors are ordered by the level of processing of the products classified therein.

The value of U.S. exports of transportation equipment to China also grew significantly, increasing by $4.3 billion (15.4 percent) to $32 billion in 2017—due, again, to growing consumer demand. Rising U.S. exports of motor vehicles and aircraft, spacecraft, and related equipment contributed to most of the change. Motor vehicle exports increased by $1.8 billion (20.7 percent) to $10.8 billion in 2017, while exports of U.S. aircraft, spacecraft, and related parts increased $1.7 billion (11.6 percent) to $16.3 billion. Chinese consumers purchased 3 percent more motor vehicles in 2017 than in 2016 (total 2017 sales were 28.9 million vehicles),^[6] and the burgeoning Chinese commercial airline sector is reliant upon foreign-produced jetliners.^[7]

U.S. exports to China of minerals and metals increased by $1.7 billion (23.2 percent) to $9 billion in 2017. Precious metal and non-numismatic coin exports increased by $575 million (183.3 percent) to $889 million. In particular, U.S. exports of unrefined and refined gold grew almost eightfold, increasing by $532 million (683.8 percent) to $610 million in 2017. China has relied upon increased imports to fill the gap between rebounding domestic demand and lesser domestic mine output. Rising consumer incomes, market reforms, and traditional cultural preferences^[8] have led China to become the world’s leading gold market for the last five years. Chinese demand for gold in 2017 was particularly strong, as consumption rose by 38 metric tons (4.2 percent) to 953 metric tons.^[9] However, Chinese mined-gold output fell by 13 metric tons (3.0 percent) to 453 metric tons in 2017,^[10] a drop attributed by market observers to stricter environmental regulations and increased resource-extraction taxes.^[11]

Agricultural products experienced the only sectoral decrease among U.S. exports to China, falling by $1.8 billion (8 percent) to $21.1 billion in 2017. Large declines in U.S. exports of oilseeds and animal feeds offset modest gains for cotton, fish, and dairy products. The value of oilseed exports (principally exports of soybeans) decreased by $1.8 billion (12.9 percent) to $12.4 billion in 2017. By volume, U.S. exports of soybeans decreased by 4 million metric tons (11 percent) to 23 million metric tons in 2017.^[12] This change reflects a decision by Chinese importers to rely increasingly on soybean suppliers from Brazil and Argentina due to their lower prices and their beans’ higher protein content.^[13] In addition, due to quality concerns regarding the presence of foreign matter in U.S. shipments, the Chinese government has tightened phytosanitary requirements for U.S. soybeans.^[14] This has further shifted demand away from U.S. soybeans and towards those of Brazil and Argentina.

Animal feeds were the subject of the second-largest trade shift in U.S. exports of agricultural products. Exports decreased by $540 million (39.8 percent) to $816 million in 2017. The major cause of this decrease was a $406 million (86.5 percent) decline in U.S. exports of dried distiller’s grains with solubles (DDGS).^[15] U.S. DDGS exports fell significantly after China imposed antidumping and countervailing duties on DDGS from the United States in September 2016.^[16]

U.S. General Imports

U.S. general imports from China increased by $43 billion (9.3 percent) to $505.6 billion in 2017. The increase in imports was driven predominantly by electronic products (table CHI.2), with other major increases occurring in machinery and miscellaneous manufactured goods. Sectors that experienced decreases in U.S. imports from China were textiles and apparel, footwear, and energy-related products.

Table CH.2: China: Leading changes in U.S. exports and imports, 2013–17

Source: Compiled from official statistics of the U.S. Department of Commerce.
Note: Import values are based on customs value; export values are based on free along ship value, U.S. port of export. Calculations based on unrounded data.

U.S. imports of electronic products from China increased by $25.2 billion (14 percent) to $205.6 billion. Imports of telecommunication equipment accounted for much of the growth, rising by $11.7 billion (19 percent) to $73.1 billion in 2017. Overall, annual Canadian and U.S. demand for smartphones grew by only 2 percent to 201.3 million units in 2017.^[17] The value increase was driven in part by higher prices for premium smartphones; the average unit value of imports from China increased by 5.9 percent.^[18] In addition, Chinese producers expanded their share of U.S. telecommunication equipment imports from 56.9 percent to 63.1 percent.^[19]

A second electronic product subgroup that experienced a significant increase in U.S. imports was computers, peripherals, and parts, imports of which rose by $6.4 billion (9.7 percent) to $73 billion in 2017. The rise in the United States’ imports of computers from China was in line with increases in U.S. imports from other nations, as well as the increase in overall U.S. demand for computers and computer peripherals. China’s share of U.S. imports of computers and related parts fell by 0.3 percent because of slightly larger increases in U.S. imports from third-party trade partners, such as Taiwan and the Philippines.^[20]  Chinese firms in the computer sector are striving to transition from supplying lower-tier goods to higher-end ones, a shift supported by the information technology pillar of China’s “Made in China 2025” development program.^[21] 

U.S. imports of machinery from China grew $4.6 billion (9.5 percent) to $53.0 billion in 2017. The largest increase in machinery imports was in air-conditioning equipment and parts, imports of which rose by $629 million (11.6 percent) to $6.0 billion in 2017. Other product categories that experienced significant increases were taps, cocks, valves, and similar devices ($509 million) and electric motors, generators, and related equipment ($483 million). Chinese gains in the imports of these goods are generally tied to overall U.S. economic growth. Chinese production of machinery and construction-related products has been stimulated by China’s investment in infrastructure products throughout the developing world through the Belt and Road initiative.^[22]

The value of U.S. imports of miscellaneous manufactured goods from China increased by $4.0 billion (6 percent) to $71.1 billion in 2017. The largest increase in miscellaneous manufactured goods involved furniture, imports of which rose by $2.3 billion (11.9 percent) to $21.6 billion in 2017. U.S. demand for furniture grew by $2.5 billion from 2016 to 2017.^[23] The Chinese furniture industry is becoming more concentrated in industrial clusters, which has reportedly allowed improvements in the industry supply chain.^[24] 

The largest declines in imports from China were found in two related product sectors: textiles and apparel, and footwear. U.S. imports of textiles and apparel declined in value by $175 million (0.4 percent) to $45 billion in 2017 as China’s share of U.S. imports fell slightly.^[25]  U.S. imports of footwear decreased by 3.8 percent to $14.2 billion in 2017, as China’s share of U.S. imports, again, decreased slightly.^[26] Profit margins for Chinese textile and footwear producers are narrowing due to wage increases and international competition from other developing nations, such as Bangladesh and Ethiopia.^[27] Global production of textiles and apparel and footwear is increasingly located outside of China, eroding China’s share of U.S. imports of these products.^[28] Nonetheless, China remains by far the largest single source of U.S. apparel and footwear to the U.S. market, by far.

U.S. Merchandise Trade Balance

The U.S. trade deficit with China grew by $28.2 billion (8.1 percent) to $375.2 billion in 2017. On a sector basis, the trade deficit expansion was due principally to electronic products (deficit up by $24.6 billion), miscellaneous manufactured goods (deficit up by $4.0 billion), machinery (deficit up by $3.8 billion), and agricultural products (surplus down by $2.2 billion). These increases in the bilateral trade deficits were offset partially by increases in U.S. surpluses for energy-related products (up by $6.0 billion) and transportation equipment (up $2.1 billion).^[29]