China Emissions Reduction Target 2035 Signals Strategic but Cautious Shift

China emissions

China emissions reduction target 2035 sets a 7-10pc cut from peak greenhouse gas emissions by the mid-2030s. This new goal adds a clearer waypoint between China’s 2030 peak pledge and its 2060 carbon neutrality target. The move sends an important policy signal to governments and investors watching how the world’s largest emitter plans its decarbonisation path.

However, the China emissions reduction target 2035 still looks cautious when compared with 1.5°C-aligned pathways. The exact baseline year and accounting rules remain unclear, leaving room for interpretation and debate. Even so, China tends to under-promise and over-deliver on climate targets, meaning real-world decarbonisation may outpace the headline number.

Meanwhile, the pledge lands in a fragmented geopolitical landscape. The contrast with a more skeptical US stance on climate policy highlights Beijing’s desire to present itself as a stable anchor in multilateral negotiations. That positioning matters for emerging markets, which rely on Chinese demand, finance and technology in their own transition plans.

Implications for energy, metals and industrial supply chains

China emissions reduction target 2035 will steadily tighten the operating environment for high-emitting sectors. Power generation, steel, cement, chemicals and transport can expect stricter efficiency standards and closer scrutiny of carbon intensity. As a result, companies tied into Chinese value chains must treat carbon as a core cost driver, not a side compliance issue.

At the same time, the target reinforces long-term support for renewables, grids and electrification. Solar, wind, batteries and EVs should see continued policy and financial backing, even if short-term demand cycles remain volatile. This will deepen structural demand for transition metals such as copper, aluminum, lithium and key rare earths linked to motors and power electronics.

Therefore, supply-chain strategies will increasingly revolve around “China-compatible” carbon footprints. Producers that can offer low-carbon materials, verified emissions data and reliable delivery into China’s ecosystem are likely to gain a premium position. Those that ignore the direction set by the China emissions reduction target 2035 risk facing shrinking market access and rising financing costs.

Policy tools behind the China emissions reduction target 2035

China emissions reduction target 2035 sits alongside a wider toolkit of energy and industrial policies. The government is expanding its national carbon trading market, gradually covering more sectors and tightening caps. This will push companies to internalise carbon costs and invest in abatement technologies.

In parallel, Beijing is prioritising non-fossil energy, aiming to raise the share of renewables and nuclear in total consumption. Large-scale grid expansion, energy storage deployment and EV infrastructure build-out will follow. As a result, project pipelines in clean energy and related metals are likely to remain robust, even if some assets struggle with profitability.

Finally, industrial upgrading policies will accelerate the shift away from low-value, energy-intensive production. High-end manufacturing, digital infrastructure and green technologies will benefit most. This industrial mix change may reduce demand for some bulk commodities while boosting demand for higher-grade, cleaner materials. Understanding those shifts is critical for miners, processors and traders planning capital allocation through 2035 and beyond.

The Metalnomist Commentary

China has quietly moved from broad climate aspirations to a concrete mid-term number, even if the ambition band remains modest. The bigger message lies in direction and consistency: carbon constraints in China will tighten, not loosen, across the next decade. For metals and energy players, treating the 2035 target as a floor — and planning for faster real-world decarbonisation — will be the more prudent strategy.

China steel industry stabilisation plan targets growth, discipline and greener output

China Steel

China’s new China steel industry stabilisation plan signals a renewed push to manage growth, capacity and pricing discipline. The government aims for around 4pc added value growth in 2025-26 while phasing out inefficient mills and banning new crude steel capacity. As a result, Beijing is trying to balance supply and demand through market-based elimination rather than another blunt production crackdown.

The China steel industry stabilisation plan prioritises competitive, higher-quality producers over weaker players. Authorities will curb “unfair competition” and “disorderly” low-price behaviour that has weighed on margins across the sector. Therefore, the plan supports consolidation around strong mills and seeks a more sustainable pricing environment for both long and flat steel products.

At the same time, the plan highlights technological upgrading, high-grade steel, and raw material security as core pillars. It calls for expanded investment to modernise production lines, accelerate low-carbon technologies and deepen the green energy transition. This innovation agenda links the China steel industry stabilisation plan directly to national strategies on industrial upgrading and decarbonisation.

Market reacts as China steel industry stabilisation plan lifts sentiment

Steel futures and spot prices reacted quickly to the announcement, even as underlying demand stayed soft. January rebar futures rose by 0.85pc to Yn3,185/t, and more than 10 mills lifted ex-works rebar offers by Yn30-50/t. However, physical trading volumes in rebar and flat products remained subdued despite the firmer sentiment.

Coking coal markets showed a more cautious response. January coking coal on the Dalian exchange closed just 0.12pc higher at Yn1,217.5/t. Many participants are still assessing how strictly the China steel industry stabilisation plan will be enforced and what it means for blast furnace operating rates. For now, sentiment in domestic coking coal remains stable rather than bullish.

Recent production data underline why Beijing is acting now. China’s crude steel output in August fell by 0.7pc year on year to 77.36mn t. January-August crude steel output dropped 2.8pc to 671.81mn t, reflecting weaker construction and real estate demand. In 2024, the top five producing provinces saw crude steel output fall 3.2pc to 522.73mn t, still accounting for 52pc of national output.

Supply-side reform echoes and the road ahead for China’s steel sector

President Xi Jinping has already signalled a political push against “disorderly low-price competition” and outdated capacity. Many market participants see the new plan as an echo of the 2015-17 supply-side reforms that aggressively cut overcapacity. However, most small, inefficient mills were already removed in that earlier cycle, leaving fewer obvious targets today.

Therefore, the next phase will likely focus on quality, emissions and efficiency rather than headline tonnage cuts. The China steel industry stabilisation plan emphasises precise capacity and output control instead of blanket production caps. That approach favours large, integrated groups with the capital to invest in green technologies, premium steel grades and digitalisation.

At the same time, Beijing wants to maintain enough capacity to support infrastructure, manufacturing and strategic industries. Balancing overcapacity risks with growth and employment remains a delicate task. How effectively the China steel industry stabilisation plan navigates this tension will shape global iron ore, coking coal and finished steel flows over the next two years.

The Metalnomist Commentary

China is shifting from a crude tonnage focus to a curated steel ecosystem built around fewer, stronger, greener champions. For global metals markets, that means more policy-driven volatility in the short term, but a likely structural tilt toward higher-value steel exports and more disciplined capacity at home. Suppliers of iron ore, coking coal and low-carbon steel technologies should all watch how fast policy turns into enforcement on the ground.

China industrial energy storage surges as metallurgical plants seek reliable power

Metallurgical plants

China industrial energy storage is rapidly expanding as metallurgical and chemical plants pair rooftop solar with behind-the-meter batteries. China industrial energy storage is growing on the back of record solar additions and rising concerns over power curtailments. As a result, China industrial energy storage is emerging as a key pillar of corporate decarbonisation and energy security strategies.

Metallurgical users lead China industrial energy storage build-out

China’s installed solar capacity reached 1,130GW by the end of September, up 46pc year on year. Meanwhile, user-side energy storage additions hit 0.24GW and 0.49GWh that month, still modest but growing quickly. Industrial and commercial customers accounted for more than 95pc of these user-side systems, underlining where the strongest business case now lies.

Projects from metallurgy, chemical and textile companies made up 73pc of new user-side capacity. This confirms that carbon reduction and power reliability are now core drivers of China industrial energy storage. Heavy users are installing co-located solar PV and batteries to cut emissions, stabilise operations and hedge against grid disruptions. For metals producers, such systems can protect continuous furnaces and electro-intensive processes from costly outages.

LFP batteries dominated the new capacity, accounting for 99.96pc of installations. However, a 90kW, 180kWh sodium-ion system also came online for an industrial user, signalling gradual diversification. Behind-the-meter solar-plus-storage projects allow factories to maximise on-site solar output and store surplus for peak hours. They also reduce exposure to curtailment and potential policy shifts in grid pricing.

Regional hotspots and scaling trajectory for China industrial energy storage

User-side energy storage growth is highly regional. Fifteen provinces commissioned new projects in September, with eastern hubs leading activity. Eastern China represented 71pc of new capacity and 43pc of project numbers, reflecting dense industrial clusters and stronger grid constraints. Jiangsu contributed nearly half of national new capacity, while Zhejiang led on project count with more than 20pc.

Zhejiang, Guangdong and Jiangsu together recorded more than 740 new user-side projects. Project numbers declined by 9pc year on year, yet total capacity jumped 68pc. This shift shows a clear move toward larger, higher-capacity China industrial energy storage systems. Bigger battery blocks better match the load profiles of smelters, rolling mills and chemical complexes.

Overall, China commissioned 3.08GW and 9.08GWh of new energy storage in September, including utility-scale systems. That represented annual growth of 166pc and 200pc, respectively. For the third quarter, new capacity reached 9.16GW and 25.52GWh, up 10pc and 24pc year on year. Installations between January and September already equalled 74pc of the 2025 full-year total, suggesting this year will exceed last year’s deployment. This trajectory ensures China industrial energy storage will remain a central pillar of the country’s broader storage boom.

The Metalnomist Commentary

China’s metals and chemicals producers are quietly driving a structural shift toward on-site solar-plus-storage. For industrials facing both decarbonisation pressure and fragile grid reliability, user-side batteries offer a rare win-win. The next test will be whether policy and market design can keep pace with the speed of industrial adoption.

Energy-Related Methane Emissions Remain Flat Despite Pledges: IEA

IEA

Major Emitters Include China, Russia, US, and Iran

Energy-related methane emissions stayed flat in 2024, according to the International Energy Agency (IEA). Global emissions from the fossil fuel sector remained at 120mn tonnes, with China, Russia, the US, and Iran accounting for over 50%. The IEA attributes the lack of progress to limited national plans and weak enforcement of pledges to cut methane.

Methane Intensity Declines but Voluntary Action Lacks Verification

Although total methane emissions have not dropped, methane intensity declined slightly due to rising hydrocarbon output. However, only 5% of oil and gas emissions are subject to near-zero verified standards. The IEA notes that 30% of emissions could be cut at no net cost, but recent declines in gas prices have reduced the cost-effectiveness of abatement.

Bioenergy Leaks and Policy Gaps Undermine Progress

Methane emissions from bioenergy sources are twice as high as earlier estimates, primarily due to incomplete combustion. India alone accounts for 20% of these emissions. Additionally, the IEA highlights that only 30 countries’ climate plans specifically address methane, with just nine setting quantifiable targets. In the US, state-level laws remain despite federal rollbacks, but low gas prices weaken incentives for emissions control.

The Metalnomist Commentary

The IEA’s report reveals a critical gap between climate pledges and implementation. Without enforceable methane abatement policies and clearer investment incentives, both the fossil and bioenergy sectors risk derailing global decarbonization timelines.

China 2026 economic policy direction signals metals demand lift

China

China’s top leadership set China 2026 economic policy direction after a high-level meeting today. The meeting backed a moderately loose stance. It also pushed faster green energy development. As a result, China 2026 economic policy direction points to higher demand for industrial inputs.

The meeting called for flexible use of policy tools. Leaders cited reserve requirement reductions and interest rate cuts. Therefore, China 2026 economic policy direction could lower financing costs. It could also support investment and construction activity.

Easier money can pull forward infrastructure and materials demand

Policy easing can boost national strategic projects and infrastructure builds. It can also support urban renewal spending. Consequently, demand can rise for steel, cement, and non-ferrous metals. Energy consumption can also climb.

Lower rates can speed inventory liquidation across bulk commodities. Therefore, spot availability can tighten faster than expected. That dynamic can help underpin commodity prices. However, the scale depends on execution details.

Green transition and AI add a new layer to supply chain signals

The meeting reaffirmed the green energy transition goal. It urged faster construction of new energy systems. It also promoted broader green electricity use. Meanwhile, it highlighted strengthening the national carbon emissions trading market.

Leaders also emphasized accelerating artificial intelligence development. They also signaled support for real estate stabilization. As a result, downstream demand for copper, aluminum, and specialty materials can improve. However, markets will wait for concrete policy specifics.

The policy signal followed comments from the International Monetary Fund in Beijing on 10 December. The IMF noted resilience despite challenges. It also forecast 5% growth for 2025. China’s GDP growth slowed to 4.8% in July–September. However, January–September growth reached 5.2%.

The Metalnomist Commentary

China’s policy stance matters most for metals through construction momentum and credit availability. However, green power expansion can shift demand toward copper, aluminum, and grid materials. Therefore, watch the first quarter policy details for real volume signals.

China’s Carbon Neutrality Push Expected to Reduce Demand for Raw Materials

China recently unveiled a "Special Action Plan for Carbon Reduction" aimed at enhancing carbon neutrality, energy efficiency, and reducing emissions. This initiative is anticipated to shift the steel industry towards electric arc furnace (EAF) production, thereby decreasing the demand for iron ore and coal.

The plan, announced by the National Development and Reform Commission (NDRC), emphasizes upgrading existing equipment and increasing the use of EAFs to significantly reduce the consumption of raw materials and emissions by 2030.

Although the immediate impact of this policy may be limited, market participants foresee a long-term negative effect on the demand for iron ore and coal. In June, the NDRC outlined specific goals to reduce energy consumption and emissions in the steel industry by the end of 2030. These include reducing per-ton energy consumption for blast furnace and converter processes by more than 1% from 2023 levels by 2025, and reducing energy consumption per ton of steel production by over 2% from 2023 levels, along with increasing the use of waste heat and pressure by at least 3%.

To achieve these objectives, the NDRC and related agencies plan to encourage the increased use of EAFs and accelerate upgrades of energy-intensive equipment. Industry insiders predict that while the visible impact may be minimal in 2024, the long-term demand for iron ore and coking coal will decline.

A representative from a steel company in northern China noted that the short-term impact on coking coal demand might be minor, but the long-term demand is likely to decrease. Similarly, a raw material supplier in Shanxi Province pointed out that the demand for iron ore and coking coal will diminish as EAF production replaces some blast furnace output.

In light of these policies, the proportion of EAF production is expected to rise, and the Chinese government and steel industry are likely to push for increased self-sufficiency in iron ore. According to the China Iron and Steel Association (CISA), Chinese mining companies plan to increase domestic iron ore concentrate production by 5-10 million tons in 2024 compared to 2023. CISA projects that domestic iron ore concentrate production will reach 370 million tons annually by 2025, aided by new iron ore projects.

Mysteel estimates that by 2025, total iron ore production from Chinese companies' overseas holdings will exceed 70 million tons per year, a more than 60% increase from 2020. As a result, with overall iron ore demand declining, iron ore production expansion projects are expected to continue, gradually reducing dependence on iron ore imports from this year onwards.

China’s Dongfang Electric Unveils World’s Largest Offshore Wind Turbine

Dongfang Electric

China's Dongfang Electric Corporation (DEC), a leader in energy and electromechanical manufacturing, recently rolled out the world's most powerful offshore wind turbine in Fuzhou, Fujian province. The 26MW behemoth, launched on October 12, promises to advance the nation's offshore wind energy capabilities, with enough capacity to power 55,000 homes and slash CO₂ emissions by over 80,000 tons annually.

Innovation and Efficiency in Wind Power

Equipped with the latest third-generation semi-direct drive technology, DEC’s turbine marks a significant improvement in efficiency and sustainability. This design minimizes magnet requirements, reducing the consumption rate to approximately 0.1 tons per megawatt (t/MW), a significant drop from previous levels of 0.4 t/MW and well below the 0.5-0.7 t/MW standard in traditional direct drive turbines. This innovation not only conserves resources but also aligns with China’s commitment to lowering carbon output.

China's offshore wind industry has grown at a remarkable pace, with new installations in 2023 totaling 7.183GW—9% of the global additions of 79.37GW. Forecasts suggest the pace will continue, with 8-10GW expected in 2024 and 15GW by 2025. As of 2023, China’s cumulative offshore wind capacity stands at 37.7GW, around 7.9% of the nation's total capacity. In 2021, China surpassed the United Kingdom as the top global offshore wind energy producer, supported by government subsidies and incentives.

The surging growth in offshore wind is also driving demand for rare earth magnets, especially neodymium-iron-boron (NdFeB). The Global Wind Energy Council reports that demand for NdFeB magnets is projected to reach 35,200 tons by 2025, up from 27,400 tons in 2023, spurring magnet production expansion to meet this increased demand.

As China cements its place at the forefront of the global offshore wind industry, the impacts on environmental sustainability and resource efficiency are likely to be felt far beyond its borders.

EU CBAM aluminium benchmark lowered for primary and secondary imports

Aluminium

The EU CBAM aluminium benchmark will fall for primary and secondary imports under a leaked draft. The benchmark for primary aluminium drops to 1.423t CO2 per tonne from 1.464t. The secondary benchmark falls to 0.091t CO2 per tonne from 0.139t for scrap-rich metal.

What the new benchmarks mean across the aluminium value chain

The new benchmark directly changes how much emissions value importers can deduct from CBAM liability. The benchmark sets the “free allocation” amount that reduces an importer’s payable charge once CBAM starts in 2026. As a result, a lower benchmark can raise the remaining CBAM exposure when other factors stay constant.

The EU also adds fixed benchmark uplifts for downstream aluminium products. Most intermediate products, like bars, wire, plate, and sheet, add 0.056t CO2 per tonne to the base benchmark. End-of-chain products, like containers and foil, add 0.166t CO2 per tonne to the base benchmark.

Default values raise the stakes for data quality and compliance

The EU will apply CBAM default values when importers lack adequate origin-specific emissions data. These defaults estimate embedded emissions and can drive higher payable charges. Meanwhile, the compliance risk increases if authorities suspect circumvention.

Consultancy Redshaw Advisors warned about losing access to actual emissions reporting. Lead CBAM advisor Dan Maleski said circumvention findings could remove “actual data” rights for an entire country. Therefore, importers may face forced reliance on default values even when producers track real emissions.

The draft lists notable default values for key exporting countries and product types. Unwrought aluminium from China carries 3t Scope 1 CO2 per tonne, with intermediate products at 4.88t and foil at 5.56t. Aluminium from India carries 1.87t, with intermediates at 3.44t and foil at 4.13t. United Arab Emirates also sits at 1.87t for unwrought, but lower values apply downstream at 2.22t and 2.66t. In addition, the EU plans a 10% annual mark-up to defaults for three years to cover data gaps.

The Metalnomist Commentary

The lower EU CBAM aluminium benchmark increases the premium on verified, audit-ready emissions data. Therefore, producers that document low-carbon power and process efficiency can defend pricing. Meanwhile, high default values will punish weak traceability and accelerate supplier reshuffling.

EU Steel Industry Faces Key Policy Shifts: A Call for Concrete Measures

EU Steel

The mood among European policy makers regarding the steel industry has notably shifted, with increasing support for the sector’s future. According to Axel Eggert, director-general of Eurofer, the European steel industry association, policymakers are beginning to recognize the importance of addressing the growing challenges in global steel production. However, while this shift in mood is encouraging, Eggert emphasized that these positive words must be followed by tangible actions.

Rising Political Support for EU Steel Industry

Eggert pointed out that there is more political backing for the European steel sector, especially as lawmakers become increasingly aware of the massive overcapacity in global steel production, particularly CO2-intensive steel. The Organization for Economic Cooperation and Development (OECD) predicts that global steel capacity will grow by 157 million tons over the next three years, which will likely negate the decarbonization efforts of the EU steel industry.

In response, the European Parliament has called for a European steel action plan, which has been embraced by European Commission President Ursula von der Leyen. However, Eggert stressed that while these statements are promising, they must be followed by concrete measures to ensure the long-term sustainability of the industry.

Green Steel and Public Procurement as Key Measures

One of the critical measures that Eggert advocates for is the implementation of public procurement for green steel. With the EU's ambitious decarbonization targets — a 55% reduction in CO2 emissions by 2030 and carbon neutrality by 2050 — Eggert emphasized that EU governments should lead by example. This means prioritizing green steel in public sector construction, vehicles, and other products, which would support European producers committed to decarbonizing their operations.

Global Overcapacity and Trade Distortions Impacting EU Steel

The steel industry crisis is largely driven by global overcapacity and low demand in Europe, exacerbated by high energy costs. Compounding this issue is the low-priced steel being exported by countries like China, Japan, and India, which depresses global markets. China’s exports, in particular, have been an issue for EU steel producers, as the country benefits from state subsidies, leading to significant trade distortions.

Eggert discussed how the EU has implemented anti-dumping measures on stainless steel from Indonesia, but Indonesia has circumvented these by exporting processed steel to third-party countries like Taiwan, Vietnam, and Turkey, which then re-export the products back to the EU. This tactic, along with the support from Chinese investments in Indonesia’s steel industry, has made Indonesia’s steel sector one of the largest globally.

EU Trade-Defense Measures: Need for Improvement

Eurofer has called for enhanced EU trade-defense measures to tackle issues such as dumping and excessive capacity from third countries. Eggert emphasized the need for improved steel safeguards and more effective enforcement of existing trade defense instruments. Currently, anti-dumping duties on Chinese steel are too low, undermining the efficacy of EU trade policies.

Carbon Border Adjustment Mechanism (CBAM) Concerns

The EU’s carbon border adjustment mechanism (CBAM) has been another point of contention. Third countries are already looking to export steel from their lowest CO2-emitting plants to avoid paying CBAM costs. Eggert advocated for including indirect CO2 emissions (Scope 2 emissions) in the CBAM, particularly for stainless steel, which is a major contributor to indirect emissions.

Scrap Export Concerns and India's Decarbonization Challenge

Finally, Eggert addressed concerns from India regarding the potential for a European export ban on scrap metal. While the EU does not currently have a scrap export ban, Eggert pointed out that India itself has export restrictions on scrap and needs to focus more on decarbonizing its domestic steel sector. He also warned that if India delays its decarbonization efforts until 2070, the EU will face a significant disadvantage in the global steel market.

Shanghai Extends Free License Plates for EVs Through 2025 to Boost NEV Adoption

Shanghai EV, Free License

Policy extension aligns with China’s broader push for greener, smarter vehicle consumption

Shanghai has extended its free license plate policy for new energy vehicles (NEVs) until the end of 2025. The move supports national efforts to replace older internal combustion engine (ICE) vehicles with cleaner alternatives and ease urban emissions.

The city continues to exempt NEV buyers from license plate auction fees, which remain mandatory for conventional vehicles. With over 5 million vehicles on its roads, Shanghai aims to encourage faster turnover of aging cars while reducing emissions and congestion in line with national climate goals.

Beijing and other top-tier cities ramp up NEV incentives

China’s central government confirmed in January 2025 that it would continue subsidies for both NEVs and ICE vehicles. These incentives aim to stimulate domestic demand and replace older, less efficient vehicles.

On 24 January, the Ministry of Commerce released a plan encouraging local governments to ease vehicle purchase restrictions through 2027. Major cities including Beijing, Guangzhou, and Shenzhen are adjusting quotas to prioritize NEV adoption. Beijing, for example, will raise its NEV purchase quota in 2025.

These changes form part of a broader strategy to optimize vehicle ownership systems in high-density cities where congestion is a persistent challenge.

NEV market continues to grow nationwide

As of the end of 2024, China had 31.4 million NEVs, comprising battery electric vehicles (BEVs), plug-in hybrids, and fuel cell vehicles. BEVs account for 22.09 million of that total, according to government data.

This figure represents 8.9% of China’s entire automobile population and reflects the country’s accelerating transition toward low-emission transport. Continued policy support from cities like Shanghai will likely further boost NEV sales and domestic battery demand in 2025.

China rare earth catalyst project: Runhe targets 100,000 t/yr plant in Sichuan

Runhe

China rare earth catalyst project momentum is rising as Runhe plans a major build in Leshan, Sichuan. China rare earth catalyst project capacity will reach 100,000 t/yr of rare earth catalytic materials at the new site. As a result, China rare earth catalyst project spending could reshape regional catalyst supply for industrial users.

What Runhe’s Leshan build signals for rare earth catalysts

Runhe will invest 1.5bn yuan to build the plant in Leshan’s Wutongqiao district. The company plans to start site construction in June 2026. However, Runhe has not disclosed a commissioning date.

The project targets an annual production value of about 3bn yuan at full operation. Rare earth catalysts support emissions control and high-value chemical conversions. Therefore, buyers track new capacity for both availability and qualification timelines.

Shenghe backing adds momentum to the Sichuan expansion

Shenghe is Runhe’s major shareholder and it recently reported sharp profit growth. Strong cash generation can support capex discipline and downstream scale-up. Meanwhile, Sichuan offers established rare earth and chemical supply-chain infrastructure for faster ramp-up.

The Metalnomist Commentary

This investment looks like a bid to lock in domestic catalyst security amid tighter global materials flows. However, qualification speed will matter more than nameplate capacity. Operators who prove stable performance will win the next contracts.

China Enhances Recycled Aluminium and Copper Imports to Boost Sustainability

China has taken significant steps to facilitate the importation of recycled aluminium and copper, aiming to bolster supply chains and mitigate carbon emissions from energy-intensive industries. This initiative, outlined in a recent notice by the Ministry of Ecology and Environment (MEE), underscores the country's commitment to environmental sustainability.

The MEE's draft regulations propose a reclassification of recycled aluminium, copper, and their alloys, distinguishing them from other solid waste categories. This reclassification will allow these materials to be imported without the stringent restrictions typically imposed on more ecologically harmful waste.

By promoting the import of recycled metals, China is intensifying its efforts to reduce carbon emissions and foster a greener industrial sector. This initiative mirrors a similar policy introduced by the MEE in 2021, which targeted the import of recycled iron and steel raw materials.

These progressive Chinese import regulations stand in stark contrast to the European Union's recent policies on waste material exports. The EU's regulations do not differentiate between waste and recyclable materials, posing challenges for the metal recycling industry.

The MEE is actively seeking market feedback on these proposed changes before finalizing the draft regulations, signaling an inclusive approach to policy formulation.

Energy Innovation Security Needs Are Reshaping Global Investment Priorities

Iea

Energy innovation security needs are now reshaping global investment priorities. The IEA said energy innovation has entered a security-focused phase. Governments now place greater emphasis on resilience, industrial competitiveness, and domestic manufacturing capacity. As a result, energy innovation security needs are changing how money and policy are directed across the sector.

This shift matters because funding is no longer guided mainly by decarbonisation and affordability. Energy security now sits at the center of policy design. Governments want stronger control over critical supply chains and strategic technologies. Therefore, energy innovation security needs are becoming a core industrial policy driver.

The funding picture is becoming more selective. Global public energy research and development spending fell 2pc to $55bn in 2025. Venture capital investment in energy technology start-ups also dropped to $27bn. Meanwhile, artificial intelligence captured a much larger share of venture funding.

Energy Technology Investment Is Moving Toward Strategic Priorities

Energy technology investment is still flowing, but it is moving toward more strategic areas. The IEA said funding for nuclear fission, critical minerals, and carbon removal has expanded sharply since 2021. That growth has offset much of the decline in transport electrification investment. As a result, governments and investors are focusing more on supply resilience and system control.

This change reflects a broader industrial logic. Countries want technologies that improve energy independence and strengthen domestic production. They also want tools that reduce vulnerability to geopolitical disruption. Therefore, energy technology investment is becoming more tied to national capability than pure climate ambition.

The innovation outlook is not entirely weaker. The IEA said recent advances have reduced the share of emissions cuts requiring non-commercial technologies. That figure fell from around 35pc in its earlier assessment to around a quarter in 2025. Consequently, the energy transition is becoming less dependent on future breakthroughs alone.

Energy Storage Patents Show Where Innovation Is Accelerating

Energy storage patents now reveal where innovation is accelerating most clearly. The share of energy storage in total energy patenting rose from 15pc to more than 40pc during 2015-23. Preliminary data suggest that share may exceed 50pc in 2024. As a result, storage is becoming the dominant innovation theme in energy technology.

That matters because storage supports both security and flexibility. It helps power systems handle more variable generation and stronger electricity demand. It also fits the broader shift toward more resilient infrastructure. Therefore, energy innovation security needs and energy storage patents are increasingly moving in the same direction.

China also remains highly influential in the innovation landscape. The IEA said around a third of low-emissions energy technology patents in 2020-24 were filed by China. Meanwhile, fossil fuel patenting continued its longer-term decline. This suggests the innovation race is becoming more concentrated around strategic low-emissions technologies.

The Metalnomist Commentary

The IEA’s message is clear: innovation is no longer driven only by climate ambition. It is now being shaped by security, sovereignty, and industrial competition. The most successful countries will likely be those that can connect innovation funding with real manufacturing and supply-chain control.

Mercedes CEO Advocates for Strategic Trade Alliances with US and China

Mercedes

Call for EU-US Trade Negotiations Amid Rising Tariff Threats

Ola Källenius, the CEO of Mercedes-Benz and the new leader of the European Automobile Manufacturers' Association (ACEA), has emphasized the need for a strategic trade agreement between the European Union (EU) and the United States. In a recent statement, Källenius urged the EU to pursue a "grand bargain" to sidestep potential trade conflicts, especially in light of the incoming US administration's threat to impose blanket tariffs on imports.

Strengthening Ties with China and Fostering Market Resilience

Beyond the Atlantic, Källenius also addressed the relationship between the EU and China, advocating for stronger internal markets rather than protective barriers. His comments highlight the delicate balance of protecting domestic jobs while benefiting from free international trade. The EU is currently managing an anti-subsidy case concerning battery electric vehicles (BEVs) imported from China, with Källenius calling for a resolution that supports both trade and environmental goals.

Navigating Automotive Decarbonization and Regulatory Challenges

The Mercedes CEO pointed out the automotive industry's need for clear regulatory frameworks, especially concerning CO2 emissions targets for EU vehicles. With 2025 and future benchmarks approaching, Källenius argues for a market-driven approach to decarbonization, rather than one that penalizes non-compliance, which could hinder investment in research and development.

Global Battery Expansion Set to Propel Anode Material Demand

Battery Anode Materials

NEV Growth and Energy Storage Boom Drive Anode Market Outlook

Rapid growth in the global battery industry is poised to boost long-term demand for anode materials and feedstocks, according to panelists at the 2024 Battery and Anode Summit in Changzhou, Jiangsu province. This demand surge reflects ongoing expansion in new energy vehicles (NEVs), energy storage systems, and consumer electronics.

Battery and Anode Output Set for Major Expansion

Global battery output is expected to reach 1,852GWh in 2025, while anode material production may hit 2.17 million tonnes. By 2028, this figure could exceed 4 million tonnes, according to ICC Sino. China produced 2.12 million tonnes of anode materials in 2024, with domestic demand reaching 1.83 million tonnes. Demand is forecast to rise steadily, reaching 3.4 million tonnes by 2028.

China’s NEV sector continues to lead global momentum, driven by sustained policy support. NEV sales in China rose 36% to 12.87 million units in 2024. Sales are projected to grow to 16 million units in 2025, supported by extended government incentives.

Renewable Energy and Silicon Anodes Add Tailwinds

Energy storage demand is also rising, with major wind and solar infrastructure developments underway in China’s Xinjiang, Gansu, Ningxia, and Inner Mongolia. Dalat county's solar generation saved 680,000 tonnes of coal in 2024 and curbed carbon emissions by 1.65 million tonnes.

Silicon-based anode materials, with energy densities up to 4,000 mAh/g, are seeing significant traction. Shipments are projected to surge from 5,300 tonnes in 2024 to nearly 81,900 tonnes by 2030, according to producer C-One.

 

Global Energy Investment to Reach $3.3 Trillion in 2025, Led by Clean Energy

IEA(International_Energy_Agency)

Clean Energy Spending Doubles Fossil Fuel Investment

Global energy investment is forecast to hit a record $3.3 trillion in 2025, with two-thirds allocated to clean energy technologies, according to the International Energy Agency (IEA). This marks a 2% real-term increase from 2024, despite ongoing geopolitical tensions and economic uncertainty.

The IEA expects $2.2 trillion to be invested in renewables, nuclear power, grids, storage, low-emissions fuels, energy efficiency, and electrification. In comparison, fossil fuel investment is projected at $1.1 trillion. The agency attributes the surge in clean energy spending to emission reduction goals, industrial policy incentives, energy security concerns, and the competitiveness of electricity-based solutions.

Energy security remains a primary driver of investment growth. While some investors are cautious about new project approvals, the IEA notes minimal disruption to existing developments.

Electricity Sector Investment Surges While Fossil Fuels Decline

The “age of electricity” is shaping global capital flows, with the power sector expected to attract $1.5 trillion in 2025. Solar power will lead the charge, drawing $450 billion alone. However, grid investment, while reaching a record $400 billion, is struggling to keep pace with soaring power demand.

Conversely, fossil fuel supply investment is expected to fall 2% — the first drop since 2020. Upstream oil spending will decline 6% to about $420 billion, while gas investment will also retreat amid price drops, higher operating costs, tariffs, and oversupply concerns. Coal investment will continue to grow, though at a slower 4% annual rate, driven largely by China and India.

Regional Shifts and Policy Impacts

China remains the largest global energy investor, with its share of clean energy investment rising from 25% a decade ago to nearly one-third today. In the US, investment in renewables and low-emission fuels is set to plateau as supportive policies wane. Meanwhile, oil and gas spending is increasingly concentrated in resource-rich Middle Eastern nations.

Spending on low-emissions fuels is projected to hit a record in 2025 but will stay below $30 billion, with projects vulnerable to policy uncertainty. The IEA warns that regional disparities in policy and market dynamics could influence the pace of the clean energy transition.

The Metalnomist Commentary

The IEA’s projection underscores the accelerating momentum of the clean energy transition, even amid economic headwinds. While record spending on renewables and electricity infrastructure marks progress, bottlenecks in grid expansion and regional policy uncertainties could challenge the pace of change. Investors and policymakers will need to address these gaps to secure long-term energy security and decarbonization goals.

China’s Shenghe Resources Acquires Jiahua Plants to Boost Rare Earth Production Capacity

In a strategic move to enhance its market presence, Shenghe Resources, a leading Chinese rare earth producer, announced its acquisition of significant stakes in Jiangyin Jiahua and Zibo Jiahua, two major rare earth separation plants. The acquisition, made through Shenghe’s wholly-owned subsidiary, Ganzhou Chenguang Rare Earth New Materials, is expected to bolster Shenghe's production capacity of rare earth oxides (REO) and improve its competitiveness in the global market.

Ganzhou Chenguang will purchase an 86 percent stake in Jiangyin Jiahua for 182.71 million yuan ($25.61 million) and a 95 percent stake in Zibo Jiahua for 29.38 million yuan ($4.11 million) from Toronto-based Neo Performance Materials. Following the transaction, Ganzhou Chenguang will fully own Zibo Jiahua after acquiring the remaining 5 percent stake from Zibo Shijia Industrial and Trading.

These acquisitions will significantly increase Shenghe Resources’ rare earth separation output. Jiangyin Jiahua, based in Jiangsu, specializes in the production of high-purity rare earth oxide and co-sediment products, with a current separation capacity of 3,800 tons per year of REO. Meanwhile, Zibo Jiahua, located in Shandong, boasts an output capacity of 5,500 tons per year for bastnaesite rare earth ores. Zibo Jiahua recently halted its light rare earth separation operations to optimize capital return, reduce earnings volatility, and mitigate concentration risk within China.

Furthermore, Zibo Jiahua has invested 500 million yuan to construct an 8,000 tons per year plant for producing high-performance rare earth catalytic materials used in exhaust catalysts to reduce emissions from internal combustion engines. If this plant reaches full operational capacity, Zibo Jiahua will become the largest producer of catalytic materials in China and globally, commanding 30-35 percent of the world market.

Shenghe Resources has also been actively pursuing global expansion to secure resources and enhance its supply chain resilience. The company recently announced plans to acquire an additional 50 percent interest in the Tanzanian rare earth mining company Ngualla Group UK Limited, in partnership with Australian firm Peak Rare Earths. Shenghe has also expanded its influence in Australia, acquiring an 18.2 percent stake in Vital Metal, an Australian rare earth exploration firm, and has reached a preliminary agreement with Blackstone Minerals to build an integrated rare earth value chain in Vietnam.

Despite these expansions, Shenghe Resources has forecasted a net loss of 48-72 million yuan in the first half of 2024, attributing the downturn to declining prices of rare earth and zirconium-titanium products, alongside increased costs of raw materials such as imported ore concentrates.

Germany's Olaf Scholz Urges Unified EU Support for EVs and Steelmakers

Scholz

German Chancellor Olaf Scholz has called on the European Union (EU) to implement comprehensive measures to boost electric vehicle (EV) manufacturing and protect its steel industry from overcapacity and dumping. Speaking at an EU leaders' meeting, Scholz emphasized the importance of collaboration within the bloc and avoiding conflicts with major trading partners like China.

Scholz specifically urged Brussels to seek a "good conclusion" with Beijing regarding countervailing duties on Chinese battery electric vehicle (BEV) imports. EU negotiators are exploring a price commitment mechanism to address concerns about cheap imports, but Scholz opposed punitive duties, arguing, "It makes no sense having a conflict about this."

EV Manufacturing and Emissions Targets

To support European carmakers, Scholz proposed that the EU reconsider its stringent greenhouse gas (GHG) emissions targets for light passenger vehicles. The upcoming target of 93.6g CO2/km for 2025-2029, a 15% reduction from 2021 levels, has faced criticism for its ambitious timelines. Scholz suggested easing penalties for automakers unable to meet these requirements by 2025, stating, "It makes no sense to burden [car manufacturers] with additional penalties for not achieving results."

The targets will tighten further, reaching 49.5g CO2/km from 2030-2034 and zero emissions by 2035, effectively banning internal combustion engine vehicles. Scholz called for a balanced approach, ensuring that penalties do not hinder firms’ liquidity, especially as they ramp up investments in electro-mobility.

Additionally, Scholz proposed a "common subsidy concept" across EU member states to stimulate EV production and enhance Europe’s competitiveness in the global automotive market.

Addressing Steel Industry Challenges

Scholz also highlighted the urgent need for the EU to tackle overcapacity, dumping, and the influx of cheap steel imports that threaten European steelmakers. He advocated for a unified strategy to safeguard the bloc's industrial base, underscoring the strategic importance of the steel sector to the EU's economy and energy transition goals.

ERG Ferroalloy-Gas Utilisation Plant to Boost Efficiency and Cut Emissions in Kazakhstan

ERG

Kazchrome to Convert Flared Gas Into Clean Power with 80MW Plant

Eurasian Resources Group (ERG) has announced plans to construct a new ferroalloy-gas utilisation plant, reinforcing its position in energy-efficient ferroalloy production. The 80MW facility, to be located within Kazchrome’s Aktobe Ferroalloy Plant, will convert 600,000m³ of flared gas into electricity. ERG signed an EPC contract with China Tianchen Engineering Corporation and expects to complete the $92 million project by 2026.

Power Self-Sufficiency and Cost Reduction Strategy

The ERG ferroalloy-gas utilisation plant will enable the company to increase self-generation capacity, reducing reliance on external power sources. As a result, Kazchrome’s operational costs will decline, improving its already industry-leading position in cost efficiency. The project also supports ERG’s carbon reduction goals by capturing and utilizing gas that would otherwise be flared.

Competitive Edge in the Global Ferrochrome Market

Kazchrome is already recognized for having the lowest production costs among ferrochrome suppliers to Europe. The addition of the ERG ferroalloy-gas utilisation plant will further enhance its cost advantage, making it difficult for competitors — particularly Indian producers — to match pricing. This strategic investment ensures ERG maintains long-term competitiveness while aligning with sustainability and energy efficiency targets.

The Metalnomist Commentary

The ERG ferroalloy-gas utilisation plant reflects a growing trend toward energy recovery in heavy industry. As environmental regulations tighten, ERG’s investment strengthens both its sustainability profile and cost leadership in global ferroalloy markets.

Electricity Drives Global Energy Demand Surge in 2024, Says IEA

IEA

Electricity led global energy growth in 2024

Electricity was the main driver of global energy demand growth in 2024, according to the IEA's Global Energy Review. Total energy demand increased by 2.2%, well above the 10-year average of 1.3% from 2013 to 2023. Electricity consumption alone rose 4.3%, boosted by extreme heat, data centers, transport electrification, and industrial use. As a result, the energy sector faced unprecedented pressure to balance supply, climate needs, and economic expansion.

The IEA noted that renewables and nuclear met 80% of the new electricity demand, while gas generation also rose steadily. In fact, 700GW of new renewable capacity was installed in 2024 — a record high. Together, renewable and nuclear power provided 40% of global electricity generation last year.

Coal, gas, and oil trends reflect shifting energy priorities

Global gas demand rose 2.7%, largely due to surging use in Asia, with China and India growing by over 7% and 10%, respectively. However, global oil demand growth slowed to just 0.8%, down from 1.9% in 2023, falling below 30% of total energy use. Electric vehicle adoption offset much of the oil demand for road transport, despite increases in aviation and petrochemical consumption. Meanwhile, coal demand growth dropped to 1.1% in 2024, half of 2023’s rate.

According to the IEA, extreme weather played a major role in global energy demand shifts.

Heatwaves in China and India accounted for more than 90% of the annual increase in coal consumption. Still, the global rise in energy-related CO₂ emissions slowed to 0.8% from 1.2% the year before.

The Metalnomist Commentary

The IEA’s 2024 review reveals the new normal: weather volatility and digitalization now shape energy flows more than economic cycles. Electricity’s dominance signals a long-term rebalancing of global power systems. For metal markets, this means sustained demand for grid, EV, and renewable infrastructure materials. As clean tech adoption accelerates, the metals supply chain becomes not only strategic—but indispensable.