[SMM Spot Titanium Flash: Titanium Concentrates Market Remains Weak, Raw Material Weakness Puts Titanium Dioxide at Further Downside Risk] SMM, August 7 –

SMM Weekly Stainless Steel Futures Review — week of July 27 – July 31, 2026. A hawkish Fed hold, deepening off-season demand weakness, and the first inventory build in weeks drag the benchmark contract down RMB 135/mt in the week

In late July, China's aluminum billet processing fees have continued to pull back from their highs in June, with φ120 aluminum billet processing fees in some major consumption areas approaching the production cost line. Amid weakening marginal demand during the off-season, increased arrivals in South China, and a relatively stable center in aluminum prices, whether processing fees can hold firm near the cost line has become the core issue of market focus....

"The store sold 86 pre-owned homes in H1, a YoY growth of 43%. High-quality 'good homes' are highly favoured by clients," Li Songqiang, commercial district manager of the Beijing Lianjia Aozhou Kangdu store, told a China Securities Journal reporter. As July began, the recovery in Beijing and Shenzhen's housing markets continued to consolidate. A reporter visited several real estate agency stores and found that trading volumes and average transaction prices in both the new and pre-owned housing markets had improved simultaneously, client inquiries and on-site viewings remained high, and the market recovery momentum was becoming increasingly clear. Experts believe that the current market still has strong resilience and self-adjustment capability, and the subsequent recovery will be mainly characterized by structural improvement driven by high-quality supply.

According to incomplete statistics, since the beginning of this year, over 20 provinces and cities nationwide, including Guangdong, Hubei, Guizhou, Yunnan, as well as Chengmai County in Hainan, Lhasa City in Tibet, Huai'an City in Jiangsu, Jinjiang City in Fujian, and Urumqi City in Xinjiang, have introduced housing purchase subsidy policies. The biggest change in the above-mentioned policies is that, on top of the universal "everyone gets a share" inclusive bonus, the "customized gift package" is precisely targeted at specific groups. In the toolbox for regulating the real estate market, housing purchase subsidies are becoming increasingly refined and differentiated. The largest beneficiary group of the "customized gift package" remains high-level talent......

The first half of 2026 has come to an end, with China's galvanized steel sheet market facing persistent demand pressure. Most market participants reported weaker order books compared with previous years, as both domestic and export orders declined to varying degrees on a year-on-year basis. Demand performance varied significantly across downstream sectors. How did each end-use segment perform in the first half of the year? And what can be expected for the market in the second half?

Per SMM statistics, the average operating rate of domestic die-casting zinc alloy manufacturers from January to June 2026 dropped by 6.25 percentage points year-on-year versus the same period in 2025, marking an evident slowdown in overall production activity.

Jul 9, 2026 News: This week, the overall operating rate of industry leaders in China's aluminum processing sector trended lower, edging down 0.7 percentage point WoW to 61.9%, significantly constrained by off-season effects. The operating rate of primary aluminum alloy edged up 0.2 percentage point to 59.6%, as enterprises focused on long-term contract deliveries, maintaining stable operations overall despite cautious procurement due to price fluctuations. The operating rate of aluminum plate/sheet and strip slipped 0.6 percentage point to 69.4%, weighed on by weak demand for general-use plates and the impact on exports from recovering capacity in North America; although the ESS sector provided support, pressure for production cuts persisted. The operating rate of aluminum wire and cable pulled back significantly by 2.4 percentage points to 66.6%, mainly because the export window closed and orders from State Grid fell short of the same period last year, with domestic demand unable to fill the gap. The operating rate of aluminum extrusion dipped 0.6 percentage point to 53.1%, as a sluggish property market led to shrinking orders for architectural extrusions; despite strong performance from industrial extrusions for ESS, the overall weakness was hard to reverse. The operating rate of aluminum foil edged down 0.4 percentage point to 71.4%, dragged down by a sharp drop in air-conditioning production schedules and the off-season for packaging, with only battery foil remaining stable. The operating rate of secondary aluminum fell 0.4 percentage point to 51.4%, constrained by multiple factors including tight tax invoices, high aluminum scrap costs, and weak end-use demand. Overall, most sectors except ESS were under pressure, and the operating rate is expected to maintain its downtrend in the short term. Primary Aluminum Alloy: This week, the operating rate of leading primary aluminum alloy enterprises in China recorded 59.6%, a slight rebound of 0.2 percentage point WoW, with an overall stable operational trend. Supply side, industry leaders primarily focused on long-term contract deliveries at this stage, with no significant adjustments observed in production arrangements and no plans for major production schedule changes; the overall operating level generally followed demand for orders on hand. Demand side, aluminum prices consolidated recently, leading to an increase in market quotation frequency, but actual transactions remained cautious. Given that the market currently operates mainly under a point-price model, price fluctuations significantly impacted sentiment among buyers and sellers. Some downstream players and traders, concerned about potential large price swings ahead, maintained a cautious procurement pace and showed limited willingness for active stockpiling. Overall, order deliveries among leading enterprises were relatively stable, and enterprises lacked significant motivation to raise operating rates. In the short term, the operating rate of leading primary aluminum alloy enterprises is expected to move sideways, likely consolidating near 59.6%. Aluminum plate/sheet and strip: This week, the operating rate of industry leaders in the aluminum plate/sheet and strip sector fell 0.6 percentage points WoW to 69.4%. At the enterprise operations level, industry operating pressure continued to mount. Producers faced the dual challenges of insufficient orders and high finished product inventories, leading to an expansion in voluntary production cuts. In terms of order structure, end-use demand for civilian general-purpose plate remained sluggish, with orders for 1xxx and 3xxx series cast-rolled products declining notably. On the export side, after the leading rolling mill in North America resumed production lines in June, its July orders have been fully reclaimed, which will directly affect China's exports to the US. Domestic can stock and automotive sheet producers that had taken on transferred orders have adjusted their production pace accordingly. The ESS sector maintained growth, with national ESS battery cell production reaching 82 GWh in June and expected to rise 4% MoM in July, providing additional order support for related plate/sheet and strip products such as battery casings and brazing materials. As we enter the mid-to-late July period, the probability that an overall demand recovery will drive up operating rates is low. The operating rate of the aluminum plate/sheet and strip industry is expected to continue consolidating on a weak note. Aluminum wire and cable: This week, the operating rate of China's aluminum wire and cable industry registered 66.6%, down 2.4 percentage points WoW. The operating rate pulled back notably during the week, mainly because the export window for aluminum stranded wire had closed, the backlog of earlier export orders was gradually being fully digested, new order intake was severely insufficient, some enterprises progressively reduced their production loads, and capacity utilization rates dropped significantly. On the domestic front, although the State Grid has been delivering orders successively, top-tier players reported that current orders on hand are smaller in scale than the same period last year, and the increase in new orders is limited, making it difficult to fill the gap left by the ebbing of export orders. Under the dual pressure of fading export dividends and insufficient domestic demand to fill the void, the industry's order structure weakened noticeably, and enterprises' production scheduling enthusiasm declined. Overall, the operating rate of China's aluminum wire and cable industry is expected to remain under pressure and decline further. Aluminum extrusion: This week, the weekly operating rate of China's aluminum extrusion industry registered 53.1%, down 0.6 percentage points WoW, continuing its downward trend. Breaking it down, building aluminum extrusion remained sluggish this week. Affected by the persistently depressed commercial real estate market, orders from end-user door and window dealers shrank notably. Some downstream door and window dealers chose to downsize their stores or even exit the market, leading to a decline in spot purchases for home improvement doors and windows, thereby dragging down the sector's operating rate. In the industrial aluminum extrusion sector, due to the traditional consumption off-season, some small and medium-sized enterprises reported insufficient follow-on orders, and their production schedules continued to decline during the week. However, recently, demand for industrial aluminum extrusion from the energy storage sector has been impressive, with order growth maintaining a positive trend, partially offsetting the decline in industrial extrusion operating rates. Overall, the weak fundamentals of building aluminum extrusion have not improved, while industrial aluminum extrusion is consolidating on a subdued note due to shrinking orders at small and medium-sized enterprises. The operating rate of the aluminum extrusion industry is expected to maintain its downward trend next week. Aluminum Foil: The operating rate of industry-leading aluminum foil enterprises fell 0.4 ppt WoW to 71.4% this week. At the enterprise operation level, the traditional off-season from July to August deepened further, with operating pressure increasing significantly across the sector. In terms of order structure, the air-conditioner foil segment was the main drag — household air conditioner domestic sales production schedules fell 17% YoY in July, and some air-conditioner aluminum foil producers reported that their production schedules were adjusted down 25–30% MoM. For packaging foil, during the traditional off-season from June to August, orders for packaging foil and pharmaceutical foil showed a clear weakening trend, and producers generally prioritized production control and inventory reduction as their primary strategy. The production pace for battery foil remained stable. Overall, under the triple pressure of deep weakness in air-conditioner foil, the packaging off-season effect, and aluminum price fluctuations, the operating rate of aluminum foil is expected to continue its downward trend in the near term. Secondary Aluminum: The operating rate of industry-leading secondary aluminum enterprises fell 0.4 ppt WoW to 51.4% this week, as tight tax invoices and the deepening traditional off-season formed a dual constraint, and production cuts and suspensions among enterprises continued. On the raw material side, affected by insufficient tax invoices and tight circulation of compliant aluminum scrap, procurement costs for aluminum scrap remained high, further squeezing enterprise profit margins. Recently, market attention on using primary aluminum to replace scrap in ADC12 production has increased, but from an actual cost calculation perspective, this approach still lacks economic viability overall. Currently, it serves more as a temporary supplementary measure to alleviate invoice shortages rather than a proactive substitution based on cost advantages. Primary aluminum prices strengthened WoW this week, further eroding the already limited substitution economics, and the scale of primary aluminum substitution in the industry did not expand significantly. On the demand side, the traditional off-season characteristics in July continued to manifest, with insufficient new orders downstream and weak restocking willingness from end-users, keeping purchases mainly need-based. After prices rose early in the week, follow-through on high-price transactions was weak; later in the week, some enterprises reported that orders weakened further compared to earlier, with sluggish transactions continuing, and demand providing limited support for operating rates. Overall, against the backdrop of tax invoice issues being difficult to resolve in the short term and the tight supply of compliant aluminum scrap, pressure on raw material supply security for secondary aluminum enterprises remained significant. If end-use demand remains persistently weak, the industry’s operating rate could face further downward potential.

In the medium to long term, the reverse-charging invoice policy will reshape the secondary copper circulation system, accelerating industry consolidation, and high-precision copper billet for new energy and AI computing power will become the core growth driver for the copper billet industry in the future.

★ Macro ★ 01 ★★ [Central Bank Net Injection of 10 Billion Yuan via Open Market Government Bond Trading in June] The People's Bank of China (PBOC) recently released data on liquidity injections through various tools in June 2026, showing a net injection of 10 billion yuan through open market government bond trading during the month. According to statistics, net injections via open market government bond trading totaled 300 billion yuan in the first six months of this year. The PBOC’s Q1 2026 monetary policy implementation report stated that since the beginning of the year, the PBOC has conducted regular government bond trading operations, flexibly adjusting the scale of operations based on the need for base money injection and bond market conditions. The June injection data also showed a net injection of 200 billion yuan through the medium-term lending facility (MLF) and a net withdrawal of 137.2 billion yuan through other structural monetary policy tools. In addition, net injections through 7-day reverse repos amounted to 582.6 billion yuan, while other-maturity reverse repos saw a net injection of 300 billion yuan. 02 ★★ Oil Prices Post Biggest Single Drop of the Year Oil prices experienced a "three consecutive decline." According to the National Development and Reform Commission (NDRC), starting from 24:00 on July 3, the retail prices of gasoline and diesel (standard grade) will be cut by 950 yuan and 915 yuan per mt, respectively. This adjustment marks the largest single reduction this year. Based on calculations by institutions, the price cut is equivalent to a decrease of 0.73 yuan per liter for 92-octane gasoline, 0.77 yuan per liter for 95-octane gasoline, and 0.78 yuan per liter for 0# diesel. For a typical private car with a 50-liter fuel tank, filling up a full tank of 92-octane gasoline will save about 36.5 yuan. ★ Industry and Downstream ★ 01 ★★ [Chinese Passenger Vehicle Market Share in Europe Surpasses Japan for the First Time] According to the latest data from the European Automobile Manufacturers' Association (ACEA), China's passenger vehicle market share in Europe surpassed that of Japan for the first time in May. Data shows that in May, five Chinese automakers sold a total of 138,400 vehicles in 31 European countries, up 65% YoY, while six Japanese automakers sold 130,400 vehicles in the same 31 countries, down 3% YoY. 02 ★★ [All 200 Billion Yuan in Funding for the Program of Large-Scale Equipment Upgrades and Consumer Goods Trade-Ins Has Been Disbursed This Year] Recently, the National Development and Reform Commission (NDRC) has issued the third batch of equipment upgrade project lists and funding allocations this year, supporting equipment renewals in fields such as energy and power, logistics, education, elderly care institutions, offline consumer commercial facilities, old operating trucks, residential old elevators, and the installation of elevators in old residential communities. Since the beginning of this year, the NDRC, together with relevant departments, has optimized the scope of support, improved the application process, strengthened review and approval, accelerated the pace of work, and disbursed equipment upgrade funds in three batches. At present, the full-year 200 billion yuan equipment renewal funds have been fully allocated, supporting about 11,000 projects across 22 sectors, providing strong support for accelerating industrial upgrading, promoting green development, improving people’s well-being, and strengthening security safeguards. From January to May this year, investment in equipment and tool purchases increased by 9.3% YoY, accounting for 17.5% of total investment, up 2.2 percentage points from the same period last year. 03 ★★ [CISA: Monthly Report on Main Steel-Using Industries, January-May] From January to May, the construction sector among main steel-using industries remained sluggish, while manufacturing continued its overall growth. Specifically, the real estate market continued its adjustment, and infrastructure investment slowed compared with earlier periods. The value added of the machinery industry and export value of electromechanical products maintained growth, automobile production continued to edge down slightly, all three major shipbuilding indicators in the shipbuilding industry grew rapidly, production of the three major white goods in the home appliance industry all maintained growth, and container production continued to decline. 04 ★★ [June Heavy-Duty Truck Market Sales Up 18% YoY] According to statistics from cvworld.cn, China’s heavy-duty truck market sold about 115,000 units in June 2026, up about 5% MoM from May and up 18% from 98,000 units in the same period last year, while the YoY growth rate slowed somewhat compared with the March-May period. This was also a record high for June sales in the past five years. In January-June, cumulative heavy-duty truck sales in China reached about 660,000 units, up about 22% YoY. ★ Other Hot Topics ★ ⭕ [Shenzhen Property Market Continues Stable and Positive Momentum] According to the Shenzhen Housing and Construction Bureau, in June, the Shenzhen property market sustained the strong momentum following the April 29 new policy. Total online registrations for new commercial housing and second-hand residential properties in the city reached 8,878 units, up 14.2% YoY, and the real estate market continued its stable and positive trend. In the new home market, online registrations for new commercial residential properties in Shenzhen totaled 3,785 units in June, up 15.6% YoY, with the new home market continuing to improve. High-quality residential projects remained highly sought after. The commercial property market also performed well, with business apartments highlighting cost-effectiveness advantages. In H1, first-hand and second-hand office buildings and business apartments in the city recorded transactions of 6,567 and 6,238 units, respectively, soaring 103.0% and 70.2% YoY, respectively. ⭕ [Shenlong Group’s “Yunnan Strip New Material Base” Fully Put into Operation] On July 2, 2026, the galvanizing workshop of Yunnan Shenlong Tengda New Material Technology Co., Ltd. (hereinafter referred to as “Yunnan Shenlong”) reported another success—the continuous hot-dip galvanizing/aluminum-zinc line with an annual capacity of 250,000 mt, contracted by Huangshi Shanli Technology Co., Ltd. (hereinafter “Shanli Technology”), was successfully put into operation. This was the third line successfully commissioned within a month, following the startup of a continuous hot-dip galvanizing line with an annual capacity of 500,000 mt on June 1 and a continuous hot-dip galvanizing/Zn-Al-Mg line, also with an annual capacity of 500,000 mt, on June 16 of this year. It marks the full commissioning of the three continuous hot-dip galvanizing/aluminum-zinc/Zn-Al-Mg lines built by Shanli Technology for Yunnan Shenlong, injecting strong new momentum into the supply of high-end new coated sheet and strip materials for China’s southwestern region! *This report is an original work and/or a compilation work of SMM Information & Technology Co., Ltd. (hereinafter referred to as “SMM”). SMM lawfully holds the copyright and is protected under the Copyright Law of the People’s Republic of China and other applicable laws, regulations, and international treaties. Without written permission, the content may not be reproduced, modified, sold, transferred, displayed, translated, compiled, disseminated, or otherwise disclosed to any third party, nor may any third party be authorized to use it. 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