The headlines are all on fire with China exports increase 17.7% in a year.

China’s exports surged in December and imports rose to a record in a stronger-than-forecast trade rebound that may lessen the case for governments to sustain stimulus programs this year.

Exports climbed 17.7 percent from a year earlier, the first increase in 14 months, and imports jumped 55.9 percent, the customs bureau said on its Web site yesterday. Year-on-year comparisons are affected by declines from late 2008 as the global credit crisis deepened.

But what is hilarious is the assumption China would somehow re-evaluate their currency due to these figures.

Digging deeper, we see that China has increased imports 55.9%. Raw commodities are the thing that stands out on imports:

For all of 2009, iron-ore imports surged 42 percent from a year earlier, those for copper and its products soared 63 percent, and purchases of aluminum and its products climbed 164 percent.

While China just overtook Germany as the world's largest exporter, the story is much more interesting on their own trade surplus.

In December, exports were $130.7 billion and imports were $112.3 billion, leaving a trade surplus of $18.4 billion.

So, is China hording raw commodities? Sure seems that way and on these exports are they really sold goods or sitting around some warehouse, supposedly to be physically shipped at a later date?

We know China's sucker, the American consumer, has stopped shopping, so it's hard to believe that China physically exported all of these finished products.

Here's a strange blurb by the Associated Press:

The return to double-digit annual growth followed a 9.6 percent rise in oil imports in 2008 when prices rose beyond $100 per barrel. In 2009, China's refineries racked up processing volumes to power a recovering economy, aided by a fuel pricing regime that largely guarantees a fixed margin.

But in a sign the volume of oil imports might not reflect real demand, the country, traditionally an importer of refined fuel, flipped to being a net seller as a 64 percent leap in exports outstripped a 39 percent rise in imports.

The glut of fuel could be set to increase -- trade sources have told Reuters that China has lined up more crude from Kuwait, Saudi Arabia and Iraq this year, and a Reuters poll found refiners planned to start the new year with record crude runs to embrace market optimism.

The question mark over 'real' demand for oil in a year of stockpiling and rampant production in China, has made it harder for traders and the government to judge the level of real economic activity.

The article is unclear if it implies China is hording oil, storing it, or literally flipping it and being a reseller from the above blurb. The implication is they sure aren't using it, which lends more credibility that China is stockpiling on raw materials.

Are raw commodities another way for China to undermine the U.S. dollar as a reserve currency?

Chinese consumers are now buying more cars than the United States, about 3 million, yet if they are flipping oil, shouldn't that all be an increase in consumption with so many new cars on the road now?

Look at the exports to the US. and Europe:

For the year, China's trade with the European Union, its top trading partner, fell 14.5% to $364 billion as exports to the EU slumped 19.4% to $236 billion. China's trade with the U.S., its second largest trading partner, sank 10.6% to $298 billion as exports fell 12.5% to $221 billion.

How can China has a record amount of exports when their two largest customers have such large drops in imports from China?

Anyone reading this if you can find the raw data released from China, please post a link in the comments. This report just doesn't seem quite right to me and finding more raw economic data from China might help shed some light on the truth of things.