G Sachs published a commodities research report updating its earnings forecasts for China’s basic materials and agriculture sectors to reflect year-to-date changes in market prices. The bank made slight adjustments to its commodity price forecasts, lowering earnings estimates for the steel, cement, gold and paper sectors, while raising forecasts for copper and coal. In terms of investment strategy, it is more constructive on coal and copper, while maintaining a cautious stance on aluminum and lithium.

For the steel and cement sectors, G Sachs noted that although China’s steel industry continues its “anti-involution” efforts and long-term capacity reduction plans, implementation of capacity and production discipline in 2026 is expected to be delayed, meaning weak profit margins may persist. The bank lowered MAANSHAN IRON (00323.HK) -0.020 (-1.093%) Short selling $1.16M; Ratio 14.905% ’s 2026 earnings forecast by 12% to 40%, cutting its H-share TP from HKD2.5 to HKD2.2 and maintaining a Neutral rating. It also expects ANGANG STEEL (00347.HK) -0.010 (-0.820%) Short selling $914.36K; Ratio 20.541% ’s 2026 loss to widen from the previously forecast RMB4 billion to RMB4.8 billion, lowering its H-share TP from HKD1.2 to HKD1.15 and maintaining a Sell rating.

In the cement sector, pricing was soft in the second quarter due to weak construction demand, but demand is expected to stabilize in 2H26 as the central government steps up infrastructure financing support. The bank trimmed 2026 earnings forecasts for CONCH CEMENT (00914.HK) -0.360 (-1.977%) Short selling $18.48M; Ratio 41.217% , BBMG (02009.HK) 0.000 (0.000%) Short selling $443.10K; Ratio 37.214% , CNBM (03323.HK) +0.370 (+8.259%) Short selling $53.04M; Ratio 22.876% and WESTCHINACEMENT (02233.HK) -0.010 (-0.526%) Short selling $1.70M; Ratio 3.472% by 0% to 9%. CONCH CEMENT’s H-share TP was lowered from HKD28 to HKD27 with a Buy rating maintained. CNBM’s Buy rating and HKD6 TP were maintained. BBMG’s H-share rating was kept at Neutral with a TP of HKD0.7, while WESTCHINACEMENT’s Sell rating and HKD1.1 TP were reiterated. CR BLDG MAT TEC (01313.HK) +0.020 (+1.724%) Short selling $1.68M; Ratio 19.302% was reaffirmed at Neutral with a TP of HKD1.3.

On coal, G Sachs expects fundamentals to remain positive, supported by rising coal chemical demand, reduced imports and strong seasonality. It raised its 2026 spot price forecast for Qinhuangdao 5,500 kcal thermal coal by RMB70 per tonne. Accordingly, it lifted 2026 earnings forecasts for CHINA SHENHUA (01088.HK) -0.620 (-1.333%) Short selling $117.91M; Ratio 40.448% , CHINA COAL (01898.HK) -0.300 (-2.344%) Short selling $15.56M; Ratio 12.554% and YANKUANG ENERGY (01171.HK) -0.660 (-4.314%) Short selling $38.12M; Ratio 13.977% by 9% to 17%. YANKUANG ENERGY’s H-share TP was increased from HKD12.5 to HKD15; however, its A-share rating for YANKUANG ENERGY (600188.SH) -0.430 (-1.706%) was downgraded to Sell, with the TP raised from RMB16 to RMB19. CHINA SHENHUA’s H-share TP was raised from HKD40 to HKD45 with a Neutral rating, while CHINA COAL’s H-share TP was lifted from HKD16 to HKD18 with a Buy rating.

Regarding gold, although G Sachs cut its 2026 gold price forecast by 5% to USD4,809 per ounce, its global commodities team remains structurally bullish on gold. It lowered ZHAOJIN MINING (01818.HK) +0.020 (+0.105%) Short selling $8.16M; Ratio 7.142% ’s 2026 earnings forecast by 3% and reduced its TP from HKD43 to HKD42, while maintaining a Buy rating. ZIJIN MINING (02899.HK) -0.583 (-1.873%) Short selling $118.15M; Ratio 11.076% was reiterated at Buy with a TP of HKD51.

For copper stocks, G Sachs raised MMG (01208.HK) -0.120 (-1.439%) Short selling $32.09M; Ratio 14.560% ’s TP from HKD13.5 to HKD14 with a Buy rating. It maintained Buy ratings on JIANGXI COPPER (00358.HK) -0.500 (-1.491%) Short selling $12.89M; Ratio 10.000% and CMOC (03993.HK) -0.420 (-2.479%) Short selling $56.03M; Ratio 16.505% , with H-share TPs of HKD45 and HKD25, respectively.

In aluminum, G Sachs expects new capacity expansion to accelerate from 2H26 onward, with aluminum price spreads gradually normalizing. It slightly lowered 2026-2028 earnings forecasts for CHALCO (02600.HK) -0.190 (-1.877%) Short selling $39.21M; Ratio 15.546% and CHINAHONGQIAO (01378.HK) -0.140 (-0.523%) Short selling $117.46M; Ratio 23.265% by 0% to 1%. CHALCO’s H-share TP was kept at HKD12.5 with a Neutral rating reiterated, while CHINAHONGQIAO’s H-share TP was maintained at HKD34 with a Neutral rating.