China’s Demand for Major Commodities Growing at “Robust Rates,” Says Goldman Sachs

China’s demand for major commodities has been experiencing “robust rates” of growth, according to a recent note by Goldman Sachs. Despite a faltering macroeconomic growth story in China, the investment bank highlighted that copper demand has risen by 8% year on year, while iron ore and oil demand have increased by 7% and 6%, respectively, surpassing Goldman’s full-year expectations. The surge in demand has been attributed to strong growth in the green economy, grid, and property completions. China’s green economy has shown “significant strength” this year, leading to a surge in demand for metals like copper. China’s operating solar capacity has exceeded 228 GW, surpassing the rest of the world combined, and the country is on track to double its wind and solar capacity five years ahead of its 2030 goals. China’s industrial production also grew by 4.5% in August, beating expectations, with the value added of equipment manufacturing growing by 5.4% year on year. Goldman Sachs predicts that the demand growth for base metals like aluminum and copper will continue into next year. China’s oil demand has also been rising due to a “rapid recovery” in oil-intensive services sectors such as transportation, although analysts expect growth to decelerate significantly next year. The surge in commodity demand in China is occurring despite a wider, faltering macroeconomic growth story in the country. Traders in the Chinese market are seeing commodities as a better bet on future improvements in the real economy.