China passes a US$1 trillion trade surplus with two months to spare, and its chip exports more than double

China has done in ten months what took it all of last year: run a goods trade surplus of more than a trillion US dollars.

Customs data released in Beijing on Tuesday showed a surplus of about US$1.04 trillion for January to October. In 2025, China’s surplus passed US$1 trillion for the first time, finishing at a record US$1.2 trillion. Economists now expect that record to fall. ING’s chief economist for Greater China, Lynn Song, said China remained “well on pace for a new record high”.

In October alone, exports rose 35.2% on a year earlier, beating forecasts of about 33.5%. Imports grew even faster, up 41.6%, which shrank the monthly surplus to US$105.3 billion from US$133.5 billion in September.

What is China selling?

The machinery of the AI boom. Semiconductor exports rose 137.1% by value, and high-tech goods led the gains. Car exports rose 37.6%.

Exports to the United States rose 32.9% in October, from a low base after last year’s tariffs, and the surplus with the US for the first ten months reached about US$266.5 billion. Exports to the European Union rose about 24% in October, and the surplus with the EU for the year so far is more than US$310 billion.

Why does the import jump matter for Australia?

Because much of it was energy and metals. By value, coal imports rose about 60% in October, liquefied natural gas about 50% and crude oil about 41%, with crude partly boosted by a recovery in shipments from the Persian Gulf. Copper and other critical minerals also helped lift the import bill, alongside AI-related technology.

Australia is one of China’s biggest suppliers of coal, gas and minerals, so a China that is buying more energy is, in principle, good news for Australian export earnings. The October figures do not break down how much of the increase came from Australian cargoes.

Can this last?

Not at this pace, most economists say. Tianchen Xu of the Economist Intelligence Unit said imports were “still dominated by AI trade”. Capital Economics estimated exports fell about 2% from September after seasonal adjustment, and Citi Research expects export growth to slow to around 8% in 2027 as last year’s weak base drops out and AI investment moderates.

There is also political pressure. “The situation is not sustainable,” said Alicia Garcia-Herrero, chief economist for Asia Pacific at Natixis. The EU has agreed with Beijing to cap imports of Chinese hybrid cars at 350,000 a year from 1 December, and the International Monetary Fund has repeatedly urged China to rely less on exports and more on its own shoppers. Retail sales grew just 1.1% in September.

Beijing says it is not seeking a bigger surplus and wants more balanced trade.

What is at stake next week?

Mr Trump and Mr Xi are due to meet at the APEC leaders’ summit in Shenzhen, their third meeting this year, with trade high on the agenda. Washington and Beijing agreed in September to extend their trade truce by two months, to January, including waivers on export controls for some critical minerals. What replaces that truce, and whether the surplus becomes the next fight, is now the question exporters on both sides are waiting on.