China’s Non‑ferrous Metals and Chemical Sectors Stage Strong First‑Half Recovery Amid Cyclical and Structural Tailwinds

As listed companies release their half‑year reports for 2026, both the non‑ferrous metals and basic chemical sectors have delivered broad‑based earnings improvements.

Statistics from the China Non‑ferrous Metals Industry Association show that 12 362 large‑scale non‑ferrous metal enterprises generated combined operating revenue of RMB 5.77 trillion in the first half of 2026, marking a 21.7 per cent year‑on‑year rise. Total profits reached RMB 418.39 billion, surging 94.0 per cent compared with the same period one year earlier.

Disclosure of half‑year financial statements for basic chemical firms is nearing completion. According to Wind data as of 23:00 on 30 August, 282 listed basic‑chemical enterprises have published their interim results. Their aggregate turnover stood at RMB 1.22 trillion, up 11.9 per cent year‑on‑year, while attributable net profits hit RMB 80.98 billion, an increase of 86 per cent. Profit‑making capacity across the sector has strengthened markedly against 2025 levels.

Analysts frame the upturn as a combined effect of cyclical price repair and industrial transformation, with profit expansion running parallel to structural optimisation, rather than a simple shift in sales volumes and pricing alone.

Metal prices maintained elevated levels through the first six months. Market conditions saw new‑energy‑related metals leading gains, industrial metals rising across the board and precious metals diverging in performance. Tin, copper, aluminium and lithium carbonate recorded particularly sharp price advances, industrial silicon faced downward pressure, and precious metals traded within high‑level ranges.

Among traditional industrial metals, LME tin prices rose 64.9 per cent year‑on‑year, buoyed by a global upturn within the semiconductor supply chain. LME copper climbed 40.4 per cent, LME aluminium advanced 36.6 per cent and LME zinc grew 32.5 per cent amid overseas supply disruptions. LME nickel registered a 17.5 per cent increase, capped by expanding nickel‑iron output from Indonesia.

For new‑energy metals, domestic futures‑market average prices for battery‑grade lithium carbonate rose 151.0 per cent year‑on‑year, and spot‑market averages jumped 205.4 per cent. Spot cobalt prices increased by 92.6 per cent.

Tight supply‑demand balances have supported firmer copper and aluminium prices. Jiangxi Copper posted attributable net profit of RMB 8.632 billion in the first half, up 106.77 per cent year‑on‑year, driven by shifts in main‑product prices and sales volumes. CMOC reported turnover of RMB 135.32 billion, 42.78 per cent higher year‑on‑year, alongside attributable net profit of RMB 16.152 billion, an 86.27 per cent rise. Tongling Non‑ferrous Metals achieved attributable net profit of RMB 2.993 billion, rising 107.93 per cent on the back of higher cathode‑copper and sulphuric‑acid prices plus improved copper‑foil processing fees.

Aluminium producers turned in particularly robust results. Hongqiao Holdings recorded attributable net profit of RMB 15.645 billion, a 77.02 per cent year‑on‑year expansion, underpinned by higher electrolytic‑aluminium selling prices and substantial falls in interest expenses, with second‑quarter profits rising a further 31.52 per cent quarter‑on‑quarter. Zhongfu Industry’s attributable net profit reached RMB 1.881 billion (+165.84 per cent), Shenhuo Co., Ltd hit RMB 4.781 billion (+151 per cent), and Tianshan Aluminium delivered RMB 4.177 billion (+100.44 per cent).

Ping An Securities notes that fundamental conditions for copper and aluminium are set to remain constructive, with price centres moving sideways but generally higher. Research from China Chengxin International points to subdued processing fees creating pressure for smelting operations, with profits flowing further to operators boasting high resource self‑sufficiency and robust cost‑control capabilities.

Profit benchmarks for the basic‑chemical sector have moved distinctly higher. Data from the National Bureau of Statistics shows profits within raw‑material manufacturing industries surged 55.2 per cent year‑on‑year across January‑July, contributing 7.1 percentage points to total profit growth for large‑scale industrial enterprises. Within this grouping, chemical‑industry profits rose 56.6 per cent, while petroleum‑processing businesses swung into profit with total earnings of RMB 42.21 billion.

Leading chemical operators reported sharp earnings rebounds. Hengyi Petrochemical recorded turnover of RMB 67.309 billion in the first half (+20.28 per cent year‑on‑year) and attributable net profit of RMB 5.902 billion (+2 500.73 per cent), as its overseas refining assets alongside domestic polyamide and polyester divisions all delivered improved profitability. Wanhua Chemical posted revenue of RMB 119.316 billion (+31.26 per cent) and attributable net profit of RMB 10.063 billion (+64.35 per cent). Satellite Chemical achieved turnover of RMB 30.713 billion (+30.92 per cent) and attributable net profit of RMB 6.227 billion (+126.94 per cent). The polyester filament segment also recovered; New Fengming realised revenue of RMB 40.691 billion (+21.50 per cent) and attributable net profit of RMB 1.439 billion (+103.16 per cent). Huafon Chemical’s attributable net profit stood at RMB 1.983 billion (+101.64 per cent), noting that volatile international crude‑oil prices lifted upstream chemical raw‑material costs while the sector moved up from cyclical lows, restoring product selling prices and margins.

Fine‑chemical and advanced‑materials segments have also picked up momentum. Fosun Plastic & Chemical’s attributable net profit reached RMB 905 million (+1 608.12 per cent), Dongyue Silicon Materials hit RMB 429 million (+916.22 per cent), Wankai New Materials RMB 562 million (+910.09 per cent), and Yongtai Technology RMB 274 million (+365.74 per cent).

Broker‑house consensus points to sustained improvement for chemical‑sector conditions. Huatai Securities observes a clear shift in capital‑expenditure momentum from late 2025 onwards. Driven by reduced destructive internal competition, dual‑control policies and the exit of ageing overseas capacity, a turning point in the industry’s capacity cycle is taking shape, strengthening global competitive positions for Chinese chemical enterprises. Donghai Securities states that the chemical sector will operate amid overlapping supportive factors for the second half of 2026: contracting supply, bottom‑forming demand and policy backing. Restocking activity among downstream supply‑chain participants may act as a secondary catalyst for price advances.

The current upturn combines cyclical price recovery with corporate industrial upgrading. Within non‑ferrous metals, copper, aluminium, tin and other commodities are increasingly valued under “technology‑metal” pricing frameworks. Accelerated build‑out of computing‑power infrastructure unlocks fresh demand for copper, aluminium, tin, tantalum and indium. Prolonged copper demand linked to artificial‑intelligence applications looks favourable for 2026, with constrained mine‑side supply paired with solid end‑use consumption. Expanding electric‑vehicle markets underpin moderate growth in cobalt demand for cathode materials.

Major chemical‑sector players reinforce profit resilience through technological innovation. Hengyi Petrochemical pushes forward large‑scale projects including its Brunei refining phase‑two complex, Xinjiang coal‑chemical facilities and circular‑material‑production schemes to diversify raw‑material sources. Wanhua Chemical has completed feedstock‑diversification upgrades for its phase‑one ethylene plant, strengthening cost advantages across its petrochemical division.

According to research from Kaiyuan Securities, low inventory levels across mid‑ and downstream industries ahead of peak seasonal consumption may spur further restocking and sustained improvement in chemical‑product price spreads. Dongxing Securities highlights slowing capacity expansion and contracting fixed‑asset‑investment growth on the supply side, alongside recovering end‑use demand and depleted inventories, pointing to ongoing improvements in supply‑demand balances for mid‑stream chemical products.

The sector’s performance is driven by both cyclical forces and long‑term growth dynamics. Donghai Securities notes that artificial‑intelligence computing‑power build‑out and new‑energy deployment create lasting growth avenues for chemical businesses. Advanced chemical materials find application within power generation, energy storage, manufacturing and thermal management. Domestic producers make headway on fluorocarbon compounds for liquid‑cooling systems, high‑grade electronic resins and thermal‑interface materials. Galaxy Securities draws attention to advanced‑material niches including electronic‑grade resins, high‑performance fluorinated materials and MLCC powder, where global computing‑power expansion opens up new commercial scope.