China's industrial capacity use falls to 6-year low amid sectoral divergence, structural transformation

In Q2 2026, China's overall industrial capacity utilization rate declined to 73%, its lowest level since Q2 2020, primarily weighed down by weakness in coal mining and petrochemical-related industries. This decline occurred despite improving utilization trends in emerging industries and several sectors targeted under anti-involution initiatives, highlighting a widening divergence between traditional industrial segments and new growth sectors.

Data released by the National Bureau of Statistics (NBS) showed that the capacity utilization rate of China's industrial enterprises above designated size was 73% in Q2, down 0.6 percentage points from Q1 and 1 percentage points lower than the same period last year. This marked the lowest level in six