July 29^th, 2026

Overall: The market continued to experience tight supply in July. Prices remained firm at high levels, with limited room for either significant increases or decreases. 
Policy are currently in a standoff between the government and enterprises, leaving the short-term market trend unclear.

Supply: production halts persist with limited new capacity
・Environmental policies remains strict, the phase-out of traditional kilns continues to be enforced. Enterprises have not received approval to resume productions, and overall industry capacity keeps at low levels.
・New-type kilns (such as rotary kilns and flash kilns) have long construction lead times. Currently, the number of operational plants using new kilns is small and their output capacity is limited, making it difficult to fill the gap left by the large-scale close down of traditional kilns in the short term.
・After several months of inventory consumed, overall industry stock levels continue to be low, providing solid support for no price dropping.

Demand: low purchasing desire
A sharp rise in international freight rates has directly pushed up CIF costs. Buyers shows less acceptability to current high price quotes, adopting a more cautious approach to order placement. 
Buying strategies have shifted from "passive acceptance of high prices" to "active procurement control," characterized by "small-volume spot purchases for essential needs" and "wait-and-see for large orders".

Price: stable with little room for negotiation
・Prices for CCM 85%/87%/90% purity remained essentially flat compared to June, with no further upward movement observed. However, suppliers maintained their offers firmly and showed little willingness to reduce.
・Products with 92% and higher purity are in even tighter supply. Quotations are unsteady, and in some cases, prices are quoted but material is temporarily unavailable. Both pricing and leadtime need to be confirmed case-by-case.
Overall, the shortage of supply supports the lower limit of prices, while weak demand restrains the upper limit of prices. The market has entered a stable stalemate state.

Policy: stalemate unresolved, two possibilities ahead
The current standoff between the government and enterprises is at a deep stalemate, which is the main uncertainty for the market's future direction.
・Possibility 1: The provincial government officially issues a mandatory document specifying a clear timeline and requirements for kiln closures. This would further tighten supply and likely drive prices higher again.
・Possibility 2: The government takes into consideration economic or employment factors and allows some enterprises to temporarily resume production. This would lead to a temporary increase in supply and potentially loosen prices.
However, regardless of the situation, the general direction of phasing-out traditional kilns and upgrading to clean production capacity will not change. But still there has been no clear policy signal released within July, and the market can only wait and observe.

Outlook
・Short term (August): The weak supply and demand situation will continue, and prices are likely to remain stable. If shipping costs decline or the policy direction becomes clear, it may disrupt the current balance.
・Medium-long term (second half of the year): Even as new production capacity is gradually released, due to the increase in environmental protection costs and raw material prices, the selling rate is unlikely to fall back to the level it was last year.

Key factors to pay attention to:
・Whether the Liaoning provincial government issues any formal documentation;
・Trends in freight rates and the recovery of international orders;
・The operating load of the production-compliant kiln changes.