Despite overcapacity, China’s large-scale exports of non-oriented electrical steel are underpinned by its complete industrial chain of the iron and steel sector. China has witnessed continuous capacity expansion of non-oriented electrical steel in recent years, leading to prominent overcapacity of mid-to-low grade conventional products. Coupled with limited incremental domestic demand from traditional home appliances and industrial motors, newly added output cannot be fully absorbed merely driven by high-grade variants for new energy vehicles. As a result, the overall domestic market remains in loose supply with mounting supply-demand pressure. Benefiting from China’s full-fledged integrated steel industrial chain, consistent product quality and economies of scale in cost control, domestically made non-oriented electrical steel has gained steadily improved cost-performance competitiveness globally. Meanwhile, rigid incremental demand has emerged from manufacturing relocation in Southeast Asia, Latin America, South Asia and other regions, as well as the popularization of high-efficiency motors overseas. Against this backdrop, the industry has continued to divert excess domestic capacity via exports, maintaining steady regular overseas shipments year-round. Imports of Non-Oriented Electrical Steel: Concentrated Sources from Japan and Chinese Taiwan, Mainly for Supplementary High-Grade Products 1. Total import volume Monthly imports of non-oriented electrical steel in the first half of 2026 posted a fluctuating trend of surging first then falling back, with May hitting the highest monthly import volume of the year. In terms of import source structure for January-June, import origins are highly concentrated. Japan ranks as the dominant top source with a far-leading import volume, followed by Chinese Taiwan as the second core supplier. South Korea takes the third place with marginal import volumes, while Germany, Sweden, France, Russia, India, Vietnam and other economies record negligible import quantities. This fully demonstrates that China only imports high-grade non-oriented electrical steel from Japanese manufacturers and Chinese Taiwan, with self-sufficiency achieved for all mid and low grades. Data Source: General Administration of Customs of the People's Republic of China 2. Breakdown by Product Specifications Imports of the two major specifications of non-oriented electrical steel from January to June 2026 were characterized by highly concentrated supply sources and obvious tiered pricing. Wide-width products (HS Code 72251900, width ≥ 600 mm) Core supplies came from Japan and Chinese Taiwan, with half-year import volumes reaching 11,719.4 tons and 10,318.8 tons respectively. Their month-on-month increments in June stood at 948.9 tons and 2,378.7 tons, serving as the primary drivers of import growth in that month. In terms of prices, the average unit price for Japanese material was RMB 9,220 per ton, and that for material from Chinese Taiwan was RMB 8,090 per ton, showing a stable price gap. Small batches of high-grade material imported from France and Sweden carried substantially higher unit prices, while low-priced marginal supplies from Russia, Vietnam, India and other economies were negligible in volume. Narrow-width products (HS Code 72261900, width ＜ 600 mm) The overall import volume was far lower than that of wide-width products, and imports were still dominated by Japan and Chinese Taiwan, with half-year imports of 453.7 tons and 202.4 tons correspondingly. Shipments picked up moderately in June, whereas import volumes from the second-tier suppliers including Germany, South Korea and Sweden remained basically flat. Price divergence was far more drastic for narrow-width grades: average prices from Japan and Chinese Taiwan hit RMB 18,660/ton and RMB 11,870/ton respectively. Average prices of high-end European and American materials approached RMB 20,000 per ton, and the unit price of goods declared for domestic circulation and customs clearance exceeded RMB 31,000 per ton. Only sporadic imports were recorded from other countries. Overall Summary In the first half of the year, non-oriented electrical steel imports were heavily reliant on mid-range conventional products sourced from Japan and Chinese Taiwan. The volume growth in June was entirely contributed by increased wide-width shipments imported from these two regions. A massive price gap existed between domestic and overseas high-grade narrow-width materials. Small volumes of high-priced special grades were imported sporadically from Europe, while low-cost marginal supplies from minor origins exerted minimal impact on the market. The market demonstrated striking features of highly concentrated supply and obvious stratified pricing. Data Source: General Administration of Customs of the People's Republic of China Exports of Non-Oriented Electrical Steel: Extensive Overseas Demand Coverage with Notable Diversified Regional Distribution 1. Total Export Volume Monthly exports of non-oriented electrical steel fluctuated throughout the first half of 2026. The aggregate monthly shipment volume from January to June was generally lower than the same period in 2025. Exports surged year-on-year in February to hit the highest point in the first six months, followed by volatile performance from April to June. In terms of cumulative export destinations for January–June 2026, overseas demand covered a wide range of markets featuring remarkable regional diversification. Vietnam ranked as China’s top export destination for non-oriented electrical steel with the largest purchasing volume in the first half of the year. Italy, Belgium, Mexico and Brazil formed the second major tier, with minimal gaps and comparable demand volumes among the four countries. South Korea, Serbia and Thailand fell into the third tier, while purchasing volumes from Pakistan and India were relatively low. The export markets spanned Southeast Asia, Western Europe, Latin America, South Asia and other regions. Decentralized procurement by overseas industrial chains for home appliances and motor manufacturing provided steady underlying support for China’s exports of non-oriented electrical steel. Data Source: General Administration of Customs of the People's Republic of China 2. Breakdown by Product Specifications Exports of the two major specifications of China’s non-oriented electrical steel in January–June 2026 were marked by clear volume tiers, as well as prominent divergence in regional flow and transaction prices. Wide-width non-oriented electrical steel (HS Code 72251900, width ≥ 600 mm) This specification constituted the absolute mainstream export product with robust growth in overseas demand. In the first half of the year, exports to Italy reached 36,428.2 tons, ranking firmly first, followed by Mexico at 33,499.6 tons and Brazil at 33,097.3 tons. Belgium, South Korea and Thailand formed the second-tier destinations, while Vietnam, Pakistan, India and Malaysia served as supplementary markets. Export destinations covered Europe, Latin America, Southeast Asia, South Asia and other regions, with Mexico recording the most remarkable volume increase in June. Prices for this wide-width grade showed narrow gaps and generally stable performance. Pakistan had the lowest average price at RMB 3,920 per ton, while Belgium and South Korea saw the highest price of RMB 5,230 per ton. Transaction prices for other countries mostly fell within the range of RMB 4,100–4,800 per ton. Narrow-width non-oriented electrical steel (HS Code 72261900, width ＜ 600 mm) Its total export volume was far lower than that of wide-width products, with highly concentrated export destinations. Vietnam (24,797.1 tons) and Serbia (21,808.7 tons) were the core absorbing markets, and the volume growth in June was mainly driven by these two markets. Pricing presented huge tiered gaps: the average export price to Japan stood at RMB 13,480 per ton, and RMB 11,680 per ton to Serbia, reflecting substantial premium for high-grade products. Mid-range materials shipped to Belgium and Slovenia were priced at RMB 8,000–9,000 per ton, whereas low-end conventional grades exported to Iran, Bangladesh and other countries were only around RMB 4,000 per ton. Overall Conclusion Wide-width products achieved volume expansion via diversified exports across multiple regions with relatively unified quotations. Narrow-width products relied heavily on two core markets, Vietnam and Serbia, and high-end exported grades enjoyed strong premium capability. Distinct structural differentiation was observed across the two specifications in terms of export volume, target markets and transaction prices. Data Source: General Administration of Customs of the People's Republic of China Conclusion On the import side, imports of wide and narrow width non-oriented electrical steel are predominantly sourced from Japanese manufacturers and Chinese Taiwan, which together account for the overwhelming majority of total import volume. The import volume growth in June was mainly driven by increased arrivals of wide-width products from Japan and Chinese Taiwan, resulting in an extremely high concentration of import supply sources. On the export side, wide-width non-oriented electrical steel serves as the absolute backbone of overseas shipments, with exports dispersed to multiple countries across Europe, Latin America and Southeast Asia. Italy, Mexico and Brazil are the core purchasing markets, and Mexico, South Korea and other destinations posted notable export volume increments in June, accompanied by relatively stable average transaction prices. By contrast, narrow-width non-oriented electrical steel registers a much smaller export volume, whose excess capacity is largely absorbed by Vietnam and Serbia. Significant price premiums are obtained from high-end overseas orders, and there is a clear divergence in purchasing volumes and transaction prices among different destination countries. In summary, China’s non-oriented electrical steel industry is basically export-oriented, with only a small volume of high-grade products imported from Japan and Chinese Taiwan as supplementary supplies.

Content of Anti-Dumping Investigation On June 22, 2026, the Ministry of Commerce and Industry of India issued a notice stating that, in response to an application filed by the Indian enterprise JSW JFE Electrical Steel Nashik Private Limited, it initiated an anti-dumping investigation on cold rolled grain-oriented electrical steel (CRGO) and amorphous metal (AM) originating in or imported from China, Japan, South Korea, and Russia. This case primarily involves products under India HS codes 72251100, 72261100, and 72269930, as well as some products under HS codes 72251920, 72251990, 72261920, 72269910, 72261990, 72269910, 72269920, and 72269990. The dumping investigation period for this case was from April 1, 2025, to March 31, 2026 (12 months), and the injury investigation period covered April 1, 2022, to March 31, 2023; April 1, 2023, to March 31, 2024; April 1, 2024, to March 31, 2025; and April 1, 2025, to March 31, 2026. China's Grain-Oriented Silicon Steel Export Situation Source: General Administration of Customs Comparing grain-oriented silicon steel exports in the first five months, monthly exports in 2025 fluctuated more sharply, with a notable pullback in February and hitting a period high in April. In the first five months of 2026, monthly exports rose steadily month by month, showing a more stable trend. Total exports from January to May 2026 were similar to those in the same period of 2025, and outside China demand remained relatively stable. Data Source: General Administration of Customs of China Among the top ten destinations for China’s grain-oriented silicon steel exports in the first five months of 2025 and 2026, India retained its position as the largest export market for two consecutive years, with notably strong growth. Exports to India were approximately 54,400 mt in the first five months of 2025, rising to 67,600 mt in the same period of 2026, a significant increase. Turkey’s ranking moved up considerably, while Mexico’s ranking declined. Slovenia and Saudi Arabia newly entered the top ten, while Thailand and Spain dropped out of the list. Exports to traditional markets such as Italy, Mexico, South Korea, Brazil, the UAE, and Vietnam generally pulled back YoY. Only India and Turkey achieved YoY increases, making India the sole major overseas demand center with substantial volume growth. China exports large quantities of grain-oriented silicon steel to India, while India’s domestic grain-oriented silicon steel producers struggle to compete, prompting India to initiate an anti-dumping investigation. Timeline Estimate for the Implementation of India’s Anti-Dumping Duties India’s anti-dumping investigations follow a clear timeline. A preliminary determination is issued 5 to 6 months after the case is initiated, and provisional duties are imposed. For complex cases like the current grain-oriented silicon steel investigation involving multiple countries, the final determination report may take up to 18 months. After the final determination recommendation is submitted to the Ministry of Finance, an additional 3-month approval period is required. The entire process, from initiation to the imposition of definitive duties, is expected to take approximately one and a half to two years. The definitive fixed duties, once imposed, remain valid for five years. Before expiry, domestic producers may request a sunset review, which also takes 12 to 18 months, during which the existing duties remain in effect. Relevant grain-oriented silicon steel export enterprises may negotiate price undertakings within a window of 3 to 8 months after case initiation, thereby avoiding both provisional and definitive duties. Potential Impact of India’s Anti-Dumping Investigation on China From Case Filing to Preliminary Ruling: When the case filing news emerged, Indian importers would proactively adopt a wait-and-see attitude, suspend new long-term contracts, and turn to supply from Japan and South Korea, causing a contraction in orders from China to India. Relevant Chinese enterprises would also bear high litigation costs and increase compliance expenses for various documents. Small and medium-sized producers without the ability to respond to the investigation would exit the Indian market directly, while top-tier players would incur significant costs in responding. After the preliminary ruling is issued in five to six months, provisional anti-dumping duties (for up to six months) would be directly imposed, significantly raising export costs and reducing shipments to India. Return cargo flows would pressure domestic spot prices of grain-oriented silicon steel, eroding steel mill profits. The willingness to conduct maintenance and control production would rise, sector sentiment would come under pressure, and the valuations of listed GO silicon steel enterprises would weaken. Downstream power equipment, such as transformers and reactors exported from China to India, would also face obstacles. Bidding costs for complete equipment sets would rise, leading to the loss of orders for power grids, PV inverters, and other Indian projects. Involution in China’s domestic demand market would intensify, with low-end transformer producers cutting prices to compete for orders, simultaneously squeezing profits. Medium to Long-Term (1-2 Years): After the final ruling in 18 months and approval by the finance ministry, a fixed hefty tariff for five years would be implemented, representing a medium- to long-term structural shock. China would be forced to adjust its GO silicon steel capacity structure, develop alternative overseas markets, advance overseas plant construction, comprehensively reduce dependence on the single Indian market, and focus on expanding incremental grid markets in the Middle East, Southeast Asia, and Latin America, diversifying the export structure. Top-tier steel mills would go global by establishing silicon steel slitting bases and joint-venture steel mills in Southeast Asia, while transformer enterprises would simultaneously build plants outside China to circumvent finished-product tariff barriers. International India Market In the short term, Indian importers are turning to sources from Japan, South Korea, and Russia, driving up procurement costs. Insufficient local capacity for low-grade silicon steel has caused raw material shortages for transformer manufacturers. Downstream power manufacturing associations are protesting the cost increases, infrastructure project quotations are rising, the power grid expansion pace is slowing, and high tariffs are raising costs across India's entire industry chain, weakening the competitiveness of its new energy and power grid infrastructure compared with Southeast Asia. In the long term, policies will continue to support local grain-oriented silicon steel projects such as JSW-JFE, with local capacity expanding significantly within five years and low-end silicon steel achieving self-supply. Global Trade Market Enterprises from Japan, South Korea, and Russia are seizing China's original share in the Indian market, forming supply substitution. China is shifting toward the Middle East, Southeast Asia, and Latin America, creating differentiated competitive tracks. Transformer and silicon steel processing stages are relocating to Vietnam, Indonesia, and Malaysia, forming a Southeast Asian power equipment manufacturing cluster. Third-country deep processing and origin-based tariff avoidance will become a long-term conventional trade pattern.

IREL seeks collaboration with Japan and South Korea for rare earth magnet production to reduce reliance on China. IREL's decision followed China's suspension of rare earth exports. The company plans domestic expansion and establishing international joint ventures in Argentina, Australia, Malawi, and Myanmar. According to Reuters, as a strategic move to decrease dependence on China, India's state-owned mining firm IREL is pursuing commercial production of rare earth magnets through partnerships with Japanese and South Korean companies.