China’s secret stockpiles have been a great success – so far

Xi Jinping is desperate for Trump-proof access to food, fuels and metals.

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Seen from the skies, China’s Dongjiakou oil storage looks like a tray of god-size cake tins. As fuel fills up the tanks, their floating roofs rise, turning the containers into panettone-shaped domes. And lately, the bakers have been busy.

Some 10 million barrels of crude have been added since mid-January, taking the total to 24 million. The state-owned facility — the largest of its kind on the Chinese coast — is barely two years old. It is already 56 per cent full.

China’s craze for crude is part of a grander plan. Since early 2024, when it became clear that Mr Donald Trump might return to the White House, officials have stockpiled fuel, food and metals to limit exposure to sanctions and tariffs.

Those measures accelerated, and broadened, after Mr Trump slapped high duties on Chinese goods in the spring. And they are continuing apace as the countries’ leaders prepare to meet on Oct 30.

Some see China’s scramble as a symptom of paranoia, perhaps even preparation for an invasion of Taiwan. Whatever the motive, the campaign is making China harder to bully, giving it an edge in trade talks. Yet, the effort also has drawbacks. As the world’s largest importer of commodities transforms global markets, it is wasting money, creating dependencies and exposing itself to new risks.

HARD POWER

China does have reason to fret about its energy supply. Despite booming electric vehicle sales, it will continue to need 16 million or so oil barrels a day (b/d) for years — three-quarters of which it must import. Its purchases of natural gas have tripled in the past 10 years as urban heating and fertiliser plants demand more. And it imports half a billion tonnes a year of coal, which remains the fuel for 60 per cent of its power.