According to China-based steel mill sources, overseas sales remained the primary driver of manufacturing-related steel consumption in July, while domestic demand remained subdued.

China Customs data showed exports of steel-intensive mechanical and electrical products jumped 33.9% year over year in July in dollar terms, with export value in the first seven months of 2026 climbing 26% from a year earlier.

Automobile exports remained particularly strong. China exported 1.09 million vehicles in July, up 57.5% year over year, customs data showed. Exports in the first seven months of 2026 totaled 6.4 million units, rising 53.7% from a year earlier.

The export-led growth contrasted sharply with sluggish domestic consumption.

China’s total retail sales of consumer goods rose just 0.6% year over year in July, slowing from a 1.3% increase in June and well below the 3.7% growth recorded in July 2025, according to the NBS data.

The weakness in the domestic passenger car retail sales, widely viewed as a proxy for consumer spending, persists into August.

Retail sales of passenger cars totaled 628,000 units over Aug. 1-16, down 22% from the year-ago period and unchanged from the same period in July, according to data released by the China Passenger Car Association on Aug. 19. Year-to-date cumulative passenger car retail sales as of Aug. 16 reached 10.8 million units, down 20% year over year.

July data for the property, infrastructure and consumption sectors all fell short of market expectations, according to a regional macroeconomic analyst. Fresh policy stimulus is unlikely in the immediate term, with authorities more likely to consider incremental support measures only if economic data in August and September remain weak, the analyst added.