China's Industrial Profits Surge 15.8%, Highest in 6 Months
Profits of Chinese industrial companies surged in March 2026. This growth was the fastest in the last six months, amid rising costs due to global energy price fluctuations.
Data from China’s National Bureau of Statistics (NBS) recorded industrial profits rising 15.8% year-on-year in March. This figure was higher than the 15.2% growth in the January-February period.
Cumulatively, industrial companies’ profits increased 15.5% in the first quarter of 2026. This achievement marked the strongest start to the year since 2017, excluding the surge during the pandemic in 2021.
NBS Statistics Chief Yu Weining stated that the manufacturing sector was the main pillar. The equipment manufacturing industry recorded a 21% profit increase. High-tech manufacturing surged 47.4%.
The performance surge was triggered by expansions in artificial intelligence and semiconductors. Optical fibre producers recorded a 336.8% profit growth. The optoelectronics sector rose 43%, while display devices grew 36.3%.
The upstream sector’s performance also strengthened. Profits of raw material producers rose 77.9% in the first quarter. Oil refineries returned to profitability after previous pressures.
Strategic industries such as aerospace, new energy, and next-generation information technology also drove growth. Non-ferrous metal companies’ profits jumped 116.7%.
This improvement came after weak performance in 2025. At that time, industrial profits only grew 0.6% after three consecutive years of contraction.
This situation drove up raw material costs such as chemicals, fibres, and plastics along the supply chain. The impact began to affect producers’ margins, especially those reliant on imports.
Domestic pressures also emerged. Domestic demand remained weak due to the property sector crisis and an unrecovered labour market. This situation triggered price competition across various sectors.
On the other hand, rising global metal prices and government policies to curb excess production capacity began to reduce deflationary pressures.
The producer price index returned to positive growth in March. This marked the first expansion in more than three years and ended a long period of deflation.