In H1 2026, China’s aluminum extrusion industry ran under three clear traits: feeble domestic demand recovery, overseas demand sliding first then bouncing back, and a sharp split between booming and sluggish product segments.

June Price Review: The monthly average price of non-oriented silicon steel exhibited a bottoming-out decline in June. On the supply-demand front, the market shifted from a slight balance to a narrow undersupply, with fundamentals continuing to improve marginally. The oversupply that previously weighed on the market gradually eased, providing price support. Spot prices performed stronger than expected, edging down only slightly. As a transitional month shifting from off-season to peak season, the supply-demand pattern improved in June. Fundamental Analysis: China's production schedule for non-oriented silicon steel continued to decline in July. Comparing with the same period in previous years, the scheduled production in July 2026 was lower than that of July 2025. Analyzing by grade, the proportion of NEV grades in the July production schedule rebounded to 15%, high grades accounted for 19%, while the proportion of low and mid-end grades pulled back to 66%. Steel mills continued to adjust their product mix, with the scheduled production of conventional low and mid-end grades shrinking accordingly. While total scheduled production continued to contract, supply-side pressure persisted. Maintaining original production levels for NEV and high-grade resources while significantly reducing low and mid-end grades optimized the supply structure to some extent, supporting market resilience. Downstream demand for non-oriented silicon steel showed structural divergence in May. In the home appliance sector, total silicon steel consumption pulled back MoM, with air conditioners remaining the core demand driver. Demand from the automotive sector was strong, with silicon steel consumption climbing to a high level for the period in May. Specifically, passenger NEVs provided the largest support for automotive silicon steel demand. Overall, traditional demand from home appliances weakened marginally, while NEV demand continued to strengthen. The demand center shifted toward the automotive sector, generating structural benefits for high-grade and NEV-grade non-oriented silicon steel. July Price Outlook: Supply side, China's planned production schedule for non-oriented silicon steel continued to decrease in July 2026, with reductions primarily focused on low and mid-end grades. On one hand, the off-season impact became more pronounced, downstream demand was soft, and purchasing interest declined, curbing production activity. On the other hand, industry leaders like Baowu and Shougang kept base prices unchanged in July, prioritizing price stability, but bearish sentiment persisted, making prices more likely to fall than rise. Most producers were loss-making and cut production autonomously. Demand side, in the home appliance sector, enterprises slowed their production pace, with orders falling MoM. The 618 shopping festival provided no significant order stimulus. Affected by low demand, high inventory, and high costs, some enterprises cut their production schedules ahead of schedule, and the implementation of new energy efficiency standards for some appliance products led to model upgrades that restricted production. In the automotive sector, automakers generally maintained normal production paces, with some increasing production schedules this month to meet mid-year targets. However, the sales promotions of the 618 festival and policies yielded limited boosting effects, and sales pressure persisted. Breaking it down, NEVs remained the main sales driver this month, orders for internal combustion engine vehicles showed no significant improvement, and exports were mainly directed to markets such as Russia, South America, and Southeast Asia, with the industry's full-year export volume expected to reach 12 million units. Cost side, with steel mill profits continuing to shrink and expectations of normalized local environmental protection-driven production restrictions, hot metal production is expected to continue to pull back. But as the off-season impact expands, the average hot-rolled coil price in July is expected to decline further MoM from June, though the extent of the decline will narrow. In summary, SMM expects that prices for low and mid-end non-oriented silicon steel will drift lower overall in July 2026, with some room for price reductions.

On July 14, data from the General Administration of Customs showed that China exported 10.32 million mt of steel in June 2026, down 21,000 mt MoM or 0.2% MoM. Cumulative exports from January to June reached 54.874 million mt, down 5.6% YoY. In June 2026, China imported 441,000 mt of steel, down 10,000 mt MoM or 2.2% MoM. Cumulative imports from January to June were 2.696 million mt, down 11.3% YoY. Table 1: Overview of Steel Imports and Exports, January-June Source: SMM Steel Exports Remained High in June According to SMM's June export production schedule survey, planned HRC export volume for the month stood at 1.05 million mt, slightly lower than actual exports in May, with a relatively limited decline. Meanwhile, SMM export order data showed that steel export orders remained high in mid-April, laying the foundation for high steel exports in May-June. Table 2: China’s Total Steel Exports Source: SMM Steel Imports Stayed Low in June On the import side, steel imports in June were 441,000 mt, down MoM. January-June cumulative imports were 2.696 million mt, down 11.3% YoY. Net steel exports reached 52.178 million mt. Short-Term Steel Export Outlook 1. Global Manufacturing Declined MoM; Domestic New Export Orders Recovered Marginally According to J.P. Morgan global PMI data, the global manufacturing PMI stood at 52.2 in June 2026, still in expansion territory but with momentum slowing for a second consecutive month, mainly due to earlier stockpiling to avoid Middle East shipping risks, while preventive stockpiling demand waned in June. In addition, end-use consumer goods demand in Europe and the US was weak, global export orders fell below the 50 mark, and the ASEAN composite PMI dropped 1 point MoM, with regional sentiment cooling significantly. China's manufacturing new export orders index at 50.1% in June, up 1.5 percentage points MoM, pointed to a marginal recovery in external demand. 2. Supply Outside China Rose MoM; Overall Supply Pressure Intensified Global crude steel production fell 0.3% YoY to 157.9 million mt in May 2026. In China, against a severe backdrop of finished steel destocking falling short of expectations and losses, steel mills proactively brought forward maintenance plans to defensively control output. Excluding China, production in the rest of the world rose 28.8% YoY. The Asian market was unusually resilient, with India's crude steel production recording 14.1 million mt. Meanwhile, Vietnam's production surged 27.2% YoY, driven not by a stress response to trade barriers but by downstream manufacturing entering a concentrated stockpiling phase, coupled with genuine demand from infrastructure projects rushing to meet deadlines ahead of the monsoon season. In contrast, production in the Middle East plunged 19.4% YoY in May, with previous war damage from geopolitical conflicts and wartime energy controls remaining an invisible and heavy ceiling suppressing production resumptions in the region. Production regions in Europe and the US (the US up 9.2% YoY, Germany up 7.3% YoY) maintained relatively active operating rates, supported by new-type data center infrastructure and anticipatory moves to preempt regional trade barriers such as the EU's Carbon Border Adjustment Mechanism (CBAM). It is reported that the Middle East recently started offering billet exports and concluded deals. Meanwhile, increased production in India, Vietnam and others also put some pressure on domestic exports. Figure 1: Global Crude Steel Production by Region Source: SMM 3. Price Advantage Narrowed Significantly; Pressure on Export Orders Intensified As of July 16, 2026, HRC export quotations (FOB) for India, Turkey, and the CIS were $510/mt, $408/mt, and $530/mt, respectively, while China's HRC export quotation (FOB) was $493/mt. Currently, China's HRC export quotations are $17/mt, $115/mt, and $37/mt lower than those countries. China's steel export price advantage narrowed significantly MoM from June. The overseas market remained in the off-season, and low-price export promotion remained the main channel for them to relieve domestic pressure. In China, prices remained relatively firm supported by costs. The price spread between Chinese and overseas markets narrowed markedly, intensifying pressure on export orders. Figure 2: HRC Quotations in Major Global Markets Source: SMM 4. Export Orders Remained at Low Levels in May-June; A Sudden Increase Is Difficult According to SMM's latest steel mill export order schedule, planned HRC exports for this month totaled 1.059 million mt, up 5.2% MoM from actual exports last month. SMM's steel export order data showed that due to the ongoing overseas off-season and consecutive overseas price declines, steel export orders in May-June declined significantly MoM from the previous period. Figure 3: SMM Steel Export Order Volumes Source: SMM 5. Anti-Dumping Cases with Impact Increased in June New anti-dumping related cases in China increased in June, involving products such as steel pipes, coated sheets, cold-rolled, stainless steel, hot-rolled, and medium-thickness plates. Details of the cases and their impact volumes are shown in the table below. Table 3: New Anti-Dumping Cases in June Source: SMM Overall, against the backdrop of the overseas off-season coupled with a narrowing price advantage, the weakness in earlier export orders may gradually be reflected in export data. SMM expects that actual steel exports in July will face some downward pressure. However, as overseas prices continue to pull back and hit bottom, some new procurement demand may be released. Figure 4: Steel Exports and Forecast, 2024-2026 Source: SMM Source Declaration: All data other than publicly available information is processed by SMM based on public information, market communication, and SMM's internal database models, and is for reference only and does not constitute any decision-making advice. Note: This article is original content of this official account. If you need to reprint, whitelist, or cooperate, please contact us. 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Price Review for June: In June, the monthly average price of non-oriented silicon steel trended downward, probing the bottom. Supply-demand side, the market shifted from a slight balance to a mild undersupply, with fundamentals improving marginally. The oversupply that had been weighing on prices gradually eased, providing support for prices. Spot prices performed stronger than expected, edging down only slightly. As a transitional month between the off-season and peak season, June saw the supply-demand pattern improve. Fundamentals Analysis: The July production schedule for domestic non-oriented silicon steel is planned to decline further. Compared with the same period in previous years, the July 2026 schedule was lower than that of July 2025. In terms of grade structure, the proportion of NEV grades in the July schedule is expected to rebound to 15%, high grades at 19%, and low and mid-end grades pull back to 66%. Steel mills continue to adjust their product mix, leading to corresponding reductions in low-end conventional grades. Overall scheduled production volume continues to shrink, but supply-side pressure persists. Production levels for NEV and high-grade materials are maintained, while low and mid-end grades are significantly reduced, optimizing the supply structure to some extent and supporting price resilience. Downstream demand for non-oriented silicon steel in May showed structural divergence. Total silicon steel consumption in the home appliance sector edged down MoM, with air conditioners remaining the core demand driver. The automobile sector demand was strong, with silicon steel consumption climbing to a high for the period. Within this, passenger NEVs were the biggest support for non-oriented silicon steel demand in the auto sector. Overall, traditional home appliance demand weakened marginally, while NEV demand continued to strengthen, gradually shifting the demand center toward the auto track. This structurally benefited high-grade and NEV-grade non-oriented silicon steel. July Price Outlook: Looking ahead to July 2026, on the supply side, China's non-oriented silicon steel production schedule is planned to decline further, primarily in low and mid-end grades. On one hand, the off-season impact is becoming more pronounced: downstream demand is weak, purchasing enthusiasm has fallen, weighing on production willingness. On the other hand, leading producers such as Baowu and Shougang kept their July base prices unchanged, prioritizing price stability. However, market sentiment is bearish and prices are more likely to fall than rise. Most producers are operating at a loss and implementing voluntary production cuts. On the demand side, in the home appliance industry, producers slowed their production pace, with orders declining MoM. The "618" shopping festival did not significantly stimulate orders. Affected by low demand, high inventory, and high costs, some enterprises lowered their production schedules ahead of time. Additionally, new energy efficiency standards for certain home appliances were introduced, limiting production due to product iteration. In the automobile industry, automakers mostly maintained normal production pace, with some increasing output this month to meet mid-year targets. However, sales pressure remained due to moderate effects of the "618" promotions and policy support. Breaking it down, NEVs remained the main sales driver this month, while orders for internal combustion engine vehicles did not improve significantly. Exports were mainly directed to Russia, South America, and Southeast Asia. Total annual export volume for the industry is expected to reach 12 million units. Cost side, with steel mill profits continuing to shrink and local environmental protection-driven production restrictions becoming normalized, hot metal production is expected to decline further. However, as the impact of the off-season expands, the July average hot-rolled coil price is expected to decline further MoM from June, with the decrease narrowing. Overall, SMM expects that mid- and low-grade non-oriented silicon steel prices in July 2026 will drift lower as a whole, with room for price declines. Data Source Statement: (All data in this report, other than publicly available information, are based on publicly available information (including but not limited to industry news, seminars, exhibitions, corporate financial reports, broker reports, NBS data, customs import and export data, and various data released by major associations and institutions), market communication, and SMM's internal database models. The research team has conducted comprehensive analysis and made reasonable inferences, which are for reference only and do not constitute decision-making advice. SMM reserves the right of final interpretation of the terms of this statement and the right to adjust and modify the content of the statement in accordance with actual conditions.

Overall, the supply-demand fundamentals of the prebaked anode market are expected to remain stable in H2, but against the backdrop of continuous new capacity release, industry competition may intensify, and price trends will be more influenced by cost-side disruptions and downstream procurement pace.

South Korea's steel exports showed signs of recovery amid strong global demand for AI data center construction. According to South Korea's Ministry of Trade, Industry and Energy, steel exports reached 2.14 billion USD in June, up 9.6% year-on-year, marking the first export growth in 14 months. The US market was the main driver, with steel export volume to the US rising 58.3% in the first half to 2.2 million tonnes from 1.39 million tonnes. Notably, exports of reinforcing bars used in data center framework construction surged to about 483,500 tonnes from 14,560 tonnes a year earlier.