China's sweeping efforts to curb "involution-style" low-price competition and accelerate the phase-out of outdated industrial capacity are driving a strong rebound in key industrial commodities. Leading the surge is polysilicon, which has posted a sharp nearly 40 percent gain over the past 14 trading days amid market expectations of tighter supply discipline and improved industry fundamentals.
Since hitting a short-term low of 30,400 yuan ($4,240.75) per ton on June 25, prices of polysilicon rallied to a peak of 42,265 yuan on Friday, making polysilicon the standout performer in the current market rally. At the close on Monday, the price of polysilicon at the Guangzhou Futures Exchange hit 41,765 yuan per ton.
Echoing this directive, China's Ministry of Industry and Information Technology (MIIT) on July 3 held a symposium for manufacturing enterprises, focusing on accelerating the high-quality development of the photovoltaics industry, according to the Xinhua News Agency.
The symposium called for efforts to comprehensively deal with the problem of disorderly price competition in the photovoltaics industry in accordance with laws and regulations, as well as efforts to guide enterprises to improve product quality, phase out backward production capacities in an orderly manner and achieve healthy and sustainable development, Xinhua reported.
Other upstream resources such as coking coal and steel have also recorded strong price increases. Coking coal surged by over 8 percent last week, reflecting broad-based momentum across the commodities sector amid policy support for higher-quality growth and supply-side optimization.
The China Coal Transportation and Distribution Association announced on Monday that it held a mid-year operation meeting in Ordos, North China's Inner Mongolia Autonomous Region, stressing the need to address serious mismatches between supply and demand. The meeting urged coal firms to strictly implement long-term thermal coal contract obligations, enhance contract discipline, improve supply quality and curb "involution-style" competition.
The automobile sector is also under the spotlight. In late May, the China Association of Automobile Manufacturers issued an initiative, urging domestic new energy vehicle companies to maintain fair competition and refrain from market monopolization or product dumping. An official from the MIIT said disorderly price wars are a typical form of involution-style competition, as they hinder R&D investment, weaken product quality and safety and harm consumer interests.
In response, 17 major car manufacturers in China issued public pledges in June to ensure supplier payments within 60 days.
