China's logistics market is making a comeback into the boom zone
Expanding business volume, growing new orders and faster capital turnover, China's logistics market, a closely watched herald of economic operation, is making a comeback into the boom zone after being weighed upon by the COVID-19.
The index tracking the country's logistics market performance stood at 52.1 percent in June, climbing above the boom-bust of 50 percent for the first time after staying in the contraction zone for three months, according to the China Federation of Logistics & Purchasing (CFLP).
The sub-indices for business volume, new orders, capital turnover and employees all posted marked rebounds as the logistics delivery's reach and efficiency keep improving.
Chinese authorities, led by the Ministry of Transport, have in recent months revved up efforts to address blocks in logistics to help the economy recover from the impact of COVID-19 outbreaks.
Echoing the smoother transportation network, another index that tracks the country's warehouse sector showed that the average inventory turnover ended about a half year's downward trend by climbing 8.4 percentage points to reach 53.9 percent in June.
Hu Han, a researcher with China Logistics Information Center, also attributed the pick-up in logistics activities to growing demands from both the industrial and consumption fronts.
Logistics of industrial goods account for about 80 percent of the total value of China's social logistics, which in May reversed the downward trend.
The CFLP's latest data showed that industrial goods logistics registered a 0.7-percent year-on-year growth in May, compared with shrinking 2.9 percent in April.
"It was a turning point marking the shift from fall to rise," said CFLP's deputy director Cai Jin. "It has sent a signal that the economy is restoring growth on its supply side."
Consumption-related logistics also stayed active. The country's e-commerce logistics activities further consolidated its rebound in June with a related CFLP index climbing 2.8 percentage points over May.
During the mid-year shopping festival, major Chinese e-commerce platforms secured year-on-year transaction growths, with sales jumps in cellphones, home appliances and cosmetics.
The recovery of China's logistics sector and the economy at large is expected to sustain. A survey of the logistics firms showed that the optimism for continuous market growth rose 1.2 percentage points over the previous month, reaching a record high in four months.