What is the trend of cement market in the fourth quarter? Listen to what listed companies say.

2024-11-06 10:05:59

Asia Cement said in the third quarter report that looking forward to the fourth quarter, the demand for cement will pick up to a certain extent. With the support of increasing peak staggering efforts, the contradiction between supply and demand of cement will be alleviated in stages. It is expected that the results of the increase in cement prices in the third quarter will be maintained until the end of the year, and the benefits of cement enterprises are expected to usher in marginal improvement.

In the first three quarters of

2024, affected by the continuous bottoming of real estate investment and the slowdown of infrastructure investment, the demand for cement continued to decline, and the contradiction between supply and demand continued to intensify. Cement production hit a new low since 2010, with both volume and price falling, and industry profits falling sharply. Cement Big Data Research Institute predicts that the total profit of the cement industry in the first three quarters will be around 3.1 billion yuan, a year-on-year decline of more than 80%.

Figure: It is estimated that the total profit of the cement industry in the first three quarters of 2024 will be 3.1 billion yuan

. Data source: cement big data (https://data.ccement.com/)

. Recently, cement listed companies have disclosed their performance in the third quarter of 2024, and their performance has declined to varying degrees, with some enterprises suffering serious losses.

It is worth noting that although the overall performance of the cement industry declined sharply in the first three quarters, the situation improved in the third quarter.

Cement big data show that in the third quarter, despite the off-season market and the decline in demand as scheduled, the industry's sense of self-discipline has increased, the voice of anti-involution has risen, the focus of cement prices has shifted upward, and the net profit of conch cement has continued to improve, with a year-on-year decline of 15.01%. The ring ratio increased slightly by 2.71%.

Jidong Cement achieved a net profit of RMB 509 million in the third quarter, with a year-on-year increase of 785.61%; Shangfeng Cement achieved a net profit of RMB 234 million in the third quarter, with a year-on-year increase of 38.09%..

Recently, many cement companies have also expressed optimism about the market outlook for the fourth quarter and next year.

Asia Cement said in its third quarter report that looking forward to the fourth quarter, cement demand will show a certain recovery, and the contradiction between cement supply and demand will be alleviated in stages with the support of increasing peak staggering efforts in various regions. It is expected that the results of the third quarter cement price increase will be maintained until the end of the year. The benefits of cement enterprises are expected to improve marginally.

Jidong Cement said in a recent survey that with the end of the high temperature and rainy season, the demand in the fourth quarter has recovered, and there is still a certain gap compared with the same period. Recent national policies have released some favorable information, which is good for real estate and infrastructure, and it is expected that there will be a slight increase in cement demand next year. On the supply side next year, the company will further lead the industry self-discipline, strictly implement the industry peak staggering arrangement, and maintain the inventory at a reasonable level. Prices are expected to continue the current trend next year.

Jianfeng Cement said that from the recent market situation, the overall cement industry has better expectations for the fourth quarter. With the arrival of the peak season, the price of cement in the region where the company's main base is located is gradually recovering, and the price of the company's products is also following the market. In addition to the northwest and other regions will gradually enter the winter break, the demand and prosperity in the fourth quarter in East China and other regions are relatively good, and the price will rise steadily in the near future, and will be more stable than previous period in the medium term.

Next year, the contradiction between supply and demand in some regions is expected to ease, the market is expected to recover from the bottom, the upward stage of prosperity, and product prices will be relatively stable.

Tapai Cement said that from past data, the price elasticity of cement in the fourth quarter of each year in the Pearl River Delta region is greater, the profit contribution is higher, and it is expected that there will still be room for price increase in the Pearl River Delta in the later period.

In addition, Tapai said that in the near future, the central government will continue to stabilize real estate, special debt can be used for land reserve and acquisition of commercial housing stock, support local government debt, etc., which is expected to boost real estate and infrastructure, and will form a certain support for cement demand, and it is expected that cement demand will continue to decline next year. However, it is estimated that the decline will be narrowed.

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On November 21, the Western Construction (002302) issued a prospectus for issuing stocks to specific targets in 2021. The company plans to introduce Conch Cement as a strategic investor through this issue, and Conch Cement will subscribe for 183 million shares, accounting for 12.48% of the total equity after the issue, becoming the second largest shareholder. The purpose of this issue is to optimize the capital structure, supplement liquidity and repay bank loans, which is expected to bring the company an annual increase of 8.85 billion yuan in operating income and a total profit of 708 million yuan, up 38.71% and 78.23% respectively from 2023.