China basic materials exports rebounded notably in April, but domestic demand orders weakened sequentially
AI summary card
China basic materials exports rebounded notably in April, but domestic demand orders weakened sequentially
Based on high-frequency data and surveys of more than 60 industry contacts, Goldman Sachs believes that end-demand orders in China basic materials weakened in mid-April, with cement, construction steel, and copper demand declining year over year, while metal products exports, copper processing, and aluminum export inquiries improved, supported by overseas supply chain disruptions.
- In mid-April, only 27% of end-market respondents expected orders to improve sequentially, significantly below 95% in March; 36% expected a sequential decline, above 5% in March.
- Basic materials orders also cooled: 42% of respondents expected April orders to improve sequentially, down from 86% in March; 30% expected a decline, up from 3% in March.
- High-frequency data for the first two weeks of April pointed to cement and construction steel demand down 7-14% year over year, copper demand down 5% year over year, and aluminum and sheet demand up 5-10% year over year.
- Bright spots appeared on the export side: Middle East conflict caused supply chain disruptions outside China, improving metal products exports; copper processors reported peak-season shipments at historical highs, driven by overseas orders related to power, renewable energy, and data centers.
- On inventories, alumina, aluminum, paper, building materials, and downstream finished goods inventories were above normal levels; iron ore, coking coal, steel, and copper inventories were roughly normal; coal and OCC inventories were below normal levels.
Report interpretation
Overview
This report tracks changes in demand, orders, inventories, exports, and prices/margins in China basic materials in April 2026. The core conclusion is: end-demand orders on the domestic side were significantly weaker in mid-April than in March, with solar, home appliances, and autos weaker while power-related orders were stronger; on the external demand side, metal products exports improved markedly, especially with positive signals in copper processing and aluminum profiles/bars inquiries.
Core views
Goldman Sachs believes China basic materials demand is showing a pattern of 'slowing domestic demand, export support, and product divergence.' Cement and construction steel demand declined substantially year over year, reflecting pressure in the property and infrastructure chain; copper demand was slightly weak year over year but copper processing export orders were strong; aluminum and sheet demand grew year over year and was supported by prices and overseas inquiries. On the supply side, capacity cuts in cement and steel still lagged expectations, while aluminum smelter restarts accelerated due to strong prices.
Analysis framework
The report combines Goldman Sachs' proprietary monthly channel survey, high-frequency industry data, feedback from producers and downstream manufacturers, as well as commodity prices and stock coverage valuation tables, to cross-check order, inventory, price, margin, and export trends in China basic materials.
Methodology notes
Forward-looking order and inventory survey
Goldman Sachs surveys more than 60 industry contacts each month, covering autos/EVs, home appliances, machinery, batteries, solar, cathode materials, property developers, steel mills, iron ore traders, cement, ready-mix concrete, glass, metal processing, containerboard, coal, power, and industry associations, to assess sequential order trends and inventory levels relative to normal.
Product-level demand, price, and margin changes
The report uses high-frequency demand data for the first two weeks of April, combined with changes in prices/margins for coal, copper, cement, aluminum, steel, and lithium, to assess industry conditions and marginal supply-demand dynamics.
Asset mapping & comparison
Structured mapping from thesis to named assets (strengths, weaknesses, peers, risks).
- Copper and copper processingRelated to strong export orders and overseas demand from power, renewable energy, and data centers
- Strengths
- Many processors reported peak-season shipments reaching historical highs, with strong overseas orders and improving prices/margins.
- Weaknesses
- High-frequency data still showed domestic copper demand down 5% year over year in the first two weeks of April.
- Comparison
- Compared with domestic demand chains such as cement and construction steel, copper has stronger support from exports and high-end application demand.
- Risks
- Overseas orders may prove unsustainable, supply chain disruptions may ease, and domestic demand may continue to weaken.
- Aluminum/AluminaAffected by strong prices, production restarts, and export inquiries
- Strengths
- Aluminum and sheet demand rose 5-10% year over year, and new export inquiries for aluminum profiles and bars accelerated, potentially supporting exports in 2H26E.
- Weaknesses
- Aluminum inventories were above normal levels and rising; faster aluminum smelter restarts could create supply pressure, and aluminum margins/prices softened at the margin.
- Comparison
- Compared with copper, aluminum's export signals are positive but inventory and restart pressures are more evident.
- Risks
- Inquiries may not convert into orders, restarts may proceed too quickly, inventories may continue to build, and prices may fall.
- SteelHighly related to property, infrastructure, and manufacturing demand
- Strengths
- Sheet demand grew year over year, exports remained resilient, and finished steel inventories were normal and declining.
- Weaknesses
- Construction steel demand was down 7-14% year over year, the share of improving orders fell sharply, and capacity cuts lagged expectations.
- Comparison
- Sheet performed better than construction steel, and exports were better than domestic demand.
- Risks
- Property and infrastructure demand may remain weak, capacity discipline may be insufficient, and margins may come under pressure.
- Cement/Building MaterialsMainly affected by infrastructure and the property chain
- Strengths
- For some building materials orders, 63% of respondents still expected improvement.
- Weaknesses
- Cement demand was down 7-14% year over year, inventories were above normal levels, and capacity cuts lagged expectations.
- Comparison
- Among major products, cement and construction steel are more directly exposed to weak domestic demand.
- Risks
- Weak property sales and starts, infrastructure funding constraints, and slow inventory destocking.
- CoalRelated to power, industrial activity, and the inventory cycle
- Strengths
- Coal inventories were below normal levels and declining, while coal prices/margins improved.
- Weaknesses
- The share of improving coal orders was zero, reflecting the off-season.
- Comparison
- Price support was stronger than order momentum.
- Risks
- Seasonally weak demand may last longer, restocking may disappoint, and prices may fall back.
- LithiumRelated to batteries, EVs, and downstream price pass-through
- Strengths
- High prices were partially passed through downstream, and industry prices were broadly stable.
- Weaknesses
- Many lithium stocks in the coverage summary were rated Sell, indicating continued valuation or fundamental pressure.
- Comparison
- Compared with copper and aluminum, lithium lacks a clear narrative of improving export orders.
- Risks
- Insufficient downstream acceptance, price declines, and inventory or supply pressure.
- Paper Packaging/ContainerboardRelated to consumption, manufacturing, and OCC costs
- Strengths
- OCC inventories were below normal levels and stable.
- Weaknesses
- Demand was weak, and the Middle East crisis increased costs; containerboard inventories were above normal levels and rising.
- Comparison
- In this report, paper packaging was weaker than metal export-related products.
- Risks
- Demand may remain weak, cost pressure may broaden, and inventories may rise further.
Key data
- Share of end-demand orders improving sequentially27%Respondents in mid-April 2026 expected end-demand orders to improve sequentially, below 95% in March 2026.
- Share of end-demand orders declining sequentially36%Respondents in mid-April 2026 expected end-demand orders to decline sequentially, above 5% in March 2026.
- Share of basic materials orders improving sequentially42%Share of basic materials orders improving in April 2026, below 86% in March.
- Share of basic materials orders declining sequentially30%Share of basic materials orders declining in April 2026, above 3% in March.
- Cement and construction steel demand7-14% lower year over yearChange in China demand shown by high-frequency data for the first two weeks of April 2026.
- Copper demand5% lower year over yearChange in China demand shown by high-frequency data for the first two weeks of April 2026, but copper processing export orders were strong.
- Aluminum and sheet demand5-10% higher year over yearChange in China demand shown by high-frequency data for the first two weeks of April 2026.
- Survey sampleMore than 60 industry contactsCovering upstream producers, traders, downstream manufacturers, property developers, and industry associations.
- Seasonality assessment72% normal, 28% weaker than normal, 0% stronger than normalFeedback from all respondents on April sequential trends relative to normal seasonality.
Impact & implications
The implications for basic materials assets are fairly differentiated: domestically driven sectors such as cement, construction steel, solar, home appliances, and autos face pressure from slowing orders; metal products, copper processing, aluminum profiles, and sheet products with higher export exposure are supported by overseas supply chain disruptions and demand from power, renewable energy, and data centers. If new export inquiries for aluminum profiles and bars materialize in 2H26E, they could improve aluminum-related export demand in the second half.
Risks
- Overseas supply chain disruptions caused by the Middle East conflict may be temporary; if they ease, support for export orders could weaken.
- Capacity cuts in cement and steel are lagging expectations and may pressure prices and margins.
- Faster aluminum smelter restarts combined with above-normal inventories may weaken aluminum prices and margins.
- If orders in property, infrastructure, autos, home appliances, and solar remain weak, domestic demand-related material categories will be dragged down.
- New export inquiries may not all convert into actual orders; improvement in aluminum profiles and bars in 2H26E still needs verification.
What to watch
- Whether end-demand orders recover from weaker-than-normal seasonality from late April into May.
- Whether new export inquiries for aluminum profiles and bars in 2H26E convert into actual shipments.
- The sustainability of copper processing export orders in power equipment, renewable energy, and data center sectors.
- Whether capacity cuts in cement and steel catch up with expectations.
- Whether inventories of alumina, aluminum, paper, building materials, and downstream finished goods can be destocked.
- Marginal changes in prices/margins for coal, copper, cement, aluminum, steel, and lithium.