China June trade data: aluminum exports continued to rise, steel exports stayed high, and copper demand remained resilient.

Overview

This report tracks China's June 2026 basic materials trade data, covering steel, copper, aluminum, iron ore, and coal. The core conclusion is that external demand and import restocking were strong: aluminum exports hit a record high, steel exports remained elevated, copper spot demand was resilient, and iron ore and coal imports both rebounded significantly; however, apparent steel consumption remained under year-over-year pressure.

Core views

For aluminum, June aluminum exports rose to 711kt, up 13% month over month and 45% year over year, the standout strength in the report; however, falling aluminum prices during the month reduced export arbitrage and may weigh on July exports. For steel, June steel exports were 10.3Mt, up 7% year over year and flat month over month, with cumulative 1H26 exports at 54.9Mt, down 5.6% year over year; assuming national crude steel output moved in line with CISA member mills' production trends, June apparent steel consumption is estimated to have fallen about 9% year over year and 5.8% month over month. For copper, imports of copper and copper products were 478kt, up 7% month over month and 3% year over year; import arbitrage opened intermittently, and the Yangshan premium rose to $90/t, indicating still-solid physical demand. For iron ore, June imports were 113Mt, up 15% month over month and 6% year over year, while port inventories stabilized. For coal, June imports were 43Mt, up 29% both month over month and year over year, above market expectations, possibly driven by expectations for peak summer demand and the reopening of the arbitrage window.

Analysis framework

Based on China's June trade data, the report combines year-over-year and month-over-month comparisons, first-half cumulative figures, CISA member steel mill production, port inventories, import arbitrage, Yangshan premium, smelting treatment charges, and seasonal demand expectations to assess marginal supply-demand changes across major basic materials.

Methodology notes

• Macro and industry data trackingTrade data year-over-year/month-over-month analysis

  Use year-over-year and month-over-month changes in monthly import and export volumes to assess external demand, domestic demand, and inventory behavior.

  The report compares June import or export data for steel, copper, aluminum, iron ore, and coal on both a year-over-year and month-over-month basis, and supplements this with cumulative 1H26 data.

• Commodity supply-demand analysisArbitrage and spot premium observation

  The import arbitrage window and Yangshan premium are used to help judge the strength of physical copper demand.

  The report notes that copper import arbitrage opened intermittently, and the Yangshan premium rebounded to $90/t, the highest since early 2025, indicating that spot copper demand remains resilient.

• Steel demand estimationApparent consumption estimation

  Estimate changes in apparent steel consumption using production and trade data.

  The report assumes that the year-over-year trend in national crude steel production is similar to that of CISA member mills, and on this basis estimates that June apparent steel consumption fell 9% year over year and 5.8% month over month.

Asset mapping & comparison

Structured mapping from thesis to named assets (strengths, weaknesses, peers, risks).

• Aluminum

  Directly benefits from export growth and declining inventories.

  Strengths

  June aluminum exports hit a record high, and rising semi-finished product exports have started to drive down China inventories.

  Weaknesses

  Falling aluminum prices reduced export arbitrage, and July exports may come under pressure.

  Comparison

  Compared with steel, aluminum exports showed stronger year-over-year and month-over-month growth.

  Risks

  Narrowing export arbitrage, weaker overseas demand, or changes in trade policy.

• Steel

  Exports remain strong but domestic demand is weak.

  Strengths

  June steel exports rose 7% year over year, and exports have remained high since July began.

  Weaknesses

  Cumulative 1H26 exports fell 5.6% year over year, and June apparent consumption is estimated to have fallen 9% year over year.

  Comparison

  Export performance is better than domestic demand, but overall demand quality is weaker than for aluminum and copper.

  Risks

  A decline in external demand, insufficient domestic property and infrastructure demand, and production adjustments falling short of expectations.

• Copper

  Imports and premiums indicate resilient spot demand.

  Strengths

  Imports of copper and copper products increased both month over month and year over year, and the Yangshan premium rose to $90/t.

  Weaknesses

  Imports of copper ore and concentrate declined slightly, and treatment charges continued to fall.

  Comparison

  Demand signals are more resilient than for steel, but supply-side pressure at the mining end still needs to be tracked.

  Risks

  Higher copper prices suppressing demand, the import arbitrage window closing, and volatility in smelting profits.

• Iron Ore

  Affected by steel mill production and port inventories.

  Strengths

  June imports rose 15% month over month and 6% year over year, while port inventories stabilized.

  Weaknesses

  Pig iron output is down 2% year to date, and crude steel output is down 4% year to date.

  Comparison

  The rebound in imports is stronger than apparent end-demand for steel.

  Risks

  Weak steel demand making iron ore restocking unsustainable.

• Coal

  Driven by peak summer demand and import arbitrage.

  Strengths

  June imports rose 29% both month over month and year over year, above market expectations.

  Weaknesses

  The report's sector view on China Coal is Cautious.

  Comparison

  Import growth is strong, but the sector view is weaker than the Attractive stance on Greater China Materials.

  Risks

  Persistently high imports suppressing domestic prices, and peak-season demand falling short of expectations.

Key data

• Aluminum exports711kt, +13% month over month, +45% year over yearA record high in June; falling aluminum prices reduced export arbitrage and may affect July exports.
• Steel exports10.3Mt, +7% year over year, flat month over monthCumulative 1H26 exports were 54.9Mt, -5.6% year over year; exports have remained elevated since July began.
• Estimated apparent steel consumptionJune -9% year over year, -5.8% month over monthBased on a 3.5% year-over-year decline in average daily output at CISA member steel mills and the assumption that the national trend is similar.
• Imports of copper and copper products478kt, +7% month over month, +3% year over yearThe Yangshan premium rebounded to $90/t, indicating resilient physical demand.
• Imports of copper ore and concentrate2.34Mt, -1% month over month, -1% year over yearTreatment charges continued to decline, but strong sulfuric acid prices supported smelting profitability.
• Iron ore imports113Mt, +15% month over month, +6% year over yearChina's port inventories stabilized during the month.
• Coal imports43Mt, +29% month over month, +29% year over yearCumulative 1H26 was 225mnt, +2% year over year; June was above market expectations, and import volumes may remain elevated in July.

Impact & implications

In investment terms, strong aluminum exports and declining China inventories are positive for the near-term prosperity of the aluminum value chain, though July exports may be affected by narrowing arbitrage; copper data supports the view of resilient demand and tight spot conditions; elevated steel exports partially buffer weak domestic demand, but falling apparent consumption still indicates pressure on domestic steel demand; the sharp increase in coal imports may reflect peak-season stocking and the arbitrage window, and it remains necessary to watch whether high imports suppress domestic coal prices.

Risks

• Falling aluminum prices reduced export arbitrage, which may drag on July aluminum exports.
• Apparent steel consumption declined both year over year and month over month, indicating domestic demand remains weak.
• If demand realization falls short after coal imports came in above expectations, inventory and price pressure may follow.
• Declining imports of copper ore and concentrate and falling treatment charges may affect smelting-chain profitability and supply expectations.
• The report discloses that Morgan Stanley has investment banking, market-making, or other service relationships with multiple covered companies, and investors should be aware of potential conflicts of interest.

What to watch

• Whether July aluminum exports decline due to narrowing export arbitrage.
• Whether elevated steel exports since July can be sustained, and whether domestic apparent steel consumption improves.
• Whether the Yangshan premium and copper import arbitrage window continue to support copper imports.
• Changes in iron ore port inventories and steel mill pig iron and crude steel output.
• Whether peak summer demand can absorb high coal import volumes.