China's real growth

aps/TRL20140915
Electricity consumption in China is an important, and potentially more accurate gauge of economic activity and has been growing at 4.9 per cent for the first seven months of 2014. Chinese electricity consumption in July has slowed to a 3.0 per cent increase, marking the lowest growth rate in 16 months.
Chinese industry accounts for 70 per cent of overall electricity consumption and high energy intense sectors are responsible for 50 per cent of the total industrial electricity consumption. Industrial consumption only increased 2.9 per cent in July compared with 5.1 per cent in June. A further slew in the data breakdown is the relative increase in export manufacturing activity, while the steel and concrete industries dip into the negative for the first time. This is largely due to the rapid drop off in apartment building construction sector.
Beijing is mindful that a declining industrial sector is undesirable on multiple levels. The surprisingly bad data has sparked speculation that Beijing could unleash policies in the second half of the year to support growth in the steel and concrete industries with announcement of significant infrastructure projects.
This situation contributes, if not accounts for the low in the Iron Ore and Metallurgical Coal demand and price. The Chinese stimulus could well take 18-24 months to flow through to production. However the stimulus could well turn the sentiment in companies heavily linked to commodities.