the National Bureau of Statistics show that from January to December 2022, the national cement output was 213,000 tons, down 10.5% from the same period last year. According to statistics, the utilization rate of cement clinker production capacity in 2022 is only about 65%, which is 10 percentage points lower than that in 2021. Under the background of the serious decline in cement demand, the problem of overcapacity in the industry has become increasingly prominent.
In this regard, Conch Cement has said that the contradiction between supply and demand in the cement industry is still relatively large, with excess supply reaching 30% to 40%. In the case of vicious competition, the market is completely oversupplied, which will cause a serious blow to the industry. & nbsp; & nbsp;
The industry urgently needs to solve the problem of capacity reduction & nbsp; & nbsp; According to the record of investor relations activities disclosed by Jidong Cement on March 30, the cement industry is an industry with excess capacity, and the bottom has not really arrived. Local governments and development and reform departments continue to promote the industry to reduce production capacity, and government-led measures such as peak staggering in heating season and peak staggering in heavily polluted weather have reduced some production.
Since the off-peak production of the cement industry was first proposed at the NPC and CPPCC in 2014, the cement industry in various provinces has successively joined the ranks of off-peak production. After years of development, the region and time of off-peak production of cement in China have gradually normalized. Peak-staggering production measures effectively help cement enterprises ease supply pressure.
In recent years, in the face of the weakening market demand, the off-peak production time of the industry has been increasing and the scope has been expanding. Especially in 2022, the off-peak production time has increased significantly, and the enforcement is stronger than before. Nowadays, due to the market demand is not up to expectations, the shipment volume of enterprises is not high, environmental protection and other factors, some regions require to extend the peak staggering time again.
According to the feedback from the market, enterprises in Guizhou planned to stop kilns for 60 days in the second quarter. In the second quarter of last year, Guizhou required each production line to stop kilns for 5 days on the basis of 40 days in the off-peak production, that is, 45 days. This year, another 15 days have been added.
However, the increasing length of off-peak production is difficult to offset the "expansion" of overcapacity, and industry insiders say that the marginal effect of off-peak production is gradually decreasing. Especially in the poor areas of the old and the young, lacking the support of funds and policies, the strength and effect of peak staggering production will inevitably decline gradually.
In response, Huaxin Cement said that although "normalization of peak staggering production" and other measures will reduce cement supply, declining demand and overcapacity are still the main problems facing the cement industry, and capacity removal is still an urgent problem to be solved in the industry. & nbsp; & nbsp;
Demand continues to shrink, market competition intensifies, and cement enterprises call for increasing industry concentration & nbsp; & nbsp;
At present, the domestic cement industry has entered a new development cycle. For the future development trend of the domestic cement industry, Zheng Jianhui, chief analyst of China Cement Network Cement Big Data Research Institute, said that in the medium and long term, the cement market demand will continue to shrink. The downward trend of the
cement industry may be normalized. In the absence of a significant change in the situation of serious overcapacity in the cement industry, the decline in demand will also intensify market competition. Zhuge Wenda, chairman of Century Xinfeng Leishan Cement , proposed at the "50 People Forum on Cement Economy" sponsored by China Cement Network that in the face of the current situation, large enterprises should lead the integration of production capacity and further improve market concentration. Small and medium-sized enterprises should transform and develop in time while improving their core competitiveness. According to the data of
China Cement Net · Cement Big Data Research Institute, the market concentration of the top ten cement enterprises (CR10) in the cement industry in 2022 is about 60%, and the market concentration of the top five enterprises (CR5) is only 46.7%. Although the market concentration of cement industry is increasing year by year, it is still at a low level compared with Europe, America, Japan and other countries.
Huaxin Cement believes that under the situation of rapid decline in demand and expected weakening, only "capacity reduction" can no longer guarantee the healthy development of the industry in the medium and long term, and increasing the intensity of capacity reduction and improving the level of industry concentration has become the top priority of the cement industry.
Jidong Cement has mentioned that it should lead the industry to actively promote integration, improve market concentration, maintain a good industry development ecology, and achieve reasonable profits and capacity reduction in the case of overcapacity.
Conch Cement also said that the current concentration of the cement industry is not very high, and there is price war or vicious competition in some areas. By increasing concentration or eliminating backward production capacity, the price stability of cement can be effectively improved.
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