Non-ferrous metals surged by 148.2%, electronics skyrocketed by 203.5%! The National Bureau of Statistics released data showing that profits in these industries soared in the first two months. Why?

On March 27, the National Bureau of Statistics released data on profits of above-designated-size industrial enterprises for January to February.

In January and February, the profits of industrial enterprises above designated size nationwide increased by 15.2% year over year, with the growth rate accelerating by 14.6 percentage points compared with the whole of last year.

Image source: National Bureau of Statistics website

A reporter from the Daily Economic News (hereinafter referred to as the Economic News reporter) noted that in the first two months of this year, profits surged in related industries such as nonferrous metals, chemicals, and semiconductors. The Economic News reporter conducted interviews to explore the reasons behind the profit surge and whether it is sustainable.

Profit surges in raw-material sectors such as nonferrous metals

Specifically, in January and February, profits in the nonferrous metals sector grew by 148.2%. Within this, the profits of the aluminum rolling processing, nonferrous metal alloy manufacturing, and copper rolling processing industries increased by 264.0%, 205.1%, and 50.8% respectively; profits in the chemical sector grew by 35.9%. Within this, the profits of the inorganic salt manufacturing, inorganic acid manufacturing, and organic fertilizer and microbial fertilizer manufacturing industries increased by 518.5%, 306.3%, and 38.5% respectively.

Which industries are these raw materials related to?

In an interview with the Economic News reporter, China Guangfa Fund Management Co., Ltd. stated that in terms of industries, aluminum rolling processing products mainly serve new-energy-vehicle lightweighting, photovoltaic module frames, building profiles, and power cables; copper rolling processing corresponds to power infrastructure, AI data centers, new-energy powertrain drive systems, and consumer electronics; nonferrous metal alloys are associated with aerospace, defense industry, and high-end equipment manufacturing. In chemicals, inorganic salts are key raw materials for glass, photovoltaic, and lithium batteries; inorganic acids are widely used in metal smelting, fertilizer production, and semiconductor cleaning; organic fertilizers and microbial fertilizers directly serve green agriculture and soil improvement.

Is their profit growth driven by increased orders, or by cost or price changes?

In an interview, China Guangfa Fund Management Co., Ltd. said that in terms of driving factors, the two industries have somewhat different logics.

For the nonferrous metals industry, the surge in profits is mainly driven by “price.” With electrolytic aluminum production capacity nearing the 45 million-ton ceiling, persistent disruptions in copper-mine supply, and the boost from emerging demand such as new energy and AI, the central aluminum and copper price level has been raised significantly compared with the same period last year. The price spread in the processing stage has expanded notably.

The chemical industry, by contrast, benefits more from the resonance of “low base + cost improvement.” In the chemical industry in the same period of 2025, it was in an oversupply predicament characterized by “higher volume but lower profits,” with very thin profit bases for inorganic salts and inorganic acids. This year, with the central tendency of upstream coal and crude oil prices shifting downward, cost pressure has been eased. At the same time, a “anti-price-war” policy has driven the industry to reduce output to stabilize prices and accelerate clearing, and product price spreads have been restored.

Overall, order expansion makes a relatively limited contribution to profits in both industries; price and cost changes are the core driving forces.

Electronic industry profits surge to more than double

For high-tech manufacturing, in January and February, profits in the electronics industry and the semiconductors discrete device manufacturing industry increased by 203.5% and 130.5% year over year, respectively. What is the reason for the significant profit growth?

Regarding the reasons for the sharp rise in profits, China Guangfa Fund Management Co., Ltd. said first, there is a low-base effect. In the same period last year, the industry was at the bottom of the cycle, with inventory being run down and demand being in an off season, resulting in a relatively low profit base. Second, there is demand-side pull, especially continued ramp-up in demand for power devices and discrete devices from AI servers, high-performance computing, and auto electronics, which provides stable order support for discrete device manufacturing. Products also saw price increases to varying degrees, which brought some additional gains in profits.

Is the growth sustainable? In response, China Guangfa Fund Management Co., Ltd. said that although the growth-rate numbers may change compared with last year’s base, the overall logic of an improving industry outlook remains unchanged. As intelligent transformation and the electrification of energy electronics continue to deepen, the semiconductor industry has gradually moved out of the downturn, entering a new round of an upcycle. In the future, growth momentum will be driven more by technological innovation and structural opportunities in downstream application areas, rather than by base fluctuations alone. Overall operating trends remain stable and sound.

Daily Economic News