market changes is always the relationship between supply and demand. Even at present, the cement industry with serious overcapacity can achieve a substantial price increase in the near future, which is also based on the premise of production restriction on the supply side.
Taking the market along the Yangtze River since the end of September as an example, without the joint efforts of major cement enterprises to limit production, it is impossible to make the trip. For example , Conch Cement , as the "handle" of the market along the Yangtze River, has joined the ranks of this round of production restriction. There has never been a price increase or price drop for no reason in
this market. In the final analysis, it is the change of supply and demand.
From the demand side, cement has entered the downward cycle, and the future demand probability is worse than this year. The so-called "prepare for a rainy day", while seeing the success of the current price push up, the industry should also think about how to make a good start next year and how to develop steadily in the future.
The author believes that in the current situation, active production control is the key to maintain a good situation in the cement industry. If production control can not be effectively implemented, even if the cement price is maintained at a relatively reasonable position at the end of this year, the cement price will still be difficult to maintain in the face of severe supply and demand situation after the beginning of next year.
So how to control production?
1. Production capacity should be combined with future demand trend. According to the change of market demand and the trend of future demand, we should flexibly adjust the production plan, implement precision production, reduce ineffective supply, increase the added value of products, and even take the initiative to increase production restriction and reduce inventory. In anticipation of declining demand in the future, blindly filling inventory is likely to be "indigestion".
2. Production control is to serve the long-term benefits, not the immediate small profits. In recent years, driven by off-peak production and enterprises'initiative to limit production, the domestic cement market has obviously recovered. When some enterprises see this situation, they quickly increase their production efforts and think about "opportunism", which only focuses on the current interests will damage the long-term interests of enterprises and lay hidden dangers for the next losses of enterprises and industries.
3. Production control should become the consensus of the industry and become normal in a long period of time. Production control is nothing "embarrassed", the industry has a large area of losses, it is natural to limit production to maintain reasonable profits, this is "human nature", in fact, the foreign cement industry is also doing so, the cement industry should take production control as a normal mode of operation, do a good job of planning, and do a good job of planning. Rather than emergency "cramming" .
4. The interests of enterprises are always combined with the interests of the industry. Some enterprises always like to engage in some small actions, such as "bright rise and dark fall" and downstream "secret communication", thinking that they are very smart and take advantage of it. As everyone knows, since ancient times, fortresses have been breached from within. In the long run, the credibility of the industry does not exist, the mutual trust of enterprises does not exist, the whole industry falls into a melee, and the enterprises themselves suffer losses. Enterprises should know that in the storm, no tree can be safe, holding together to keep warm, "single tree" will eventually be pinched by others.
5. Reduce the production load to the maximum extent, and reduce the output in the fourth quarter of this year and the first quarter of next year by more than 20% on the basis of the first year. Cement demand decline is certain, according to the Bureau of Statistics data, cement demand fell by about 11% in the first October, and it is estimated that the final annual statistics are basically in this range. However, from the perspective of industry sentiment, most cement companies are expected to see a 15-20% decline in sales this year, which may be more inclined to the actual decline in cement demand. In view of this, the author suggests that the output of enterprises in the industry in the fourth quarter and the first quarter of next year should be reduced by 20% on the basis of the first year.
For the development of the industry, only when the industry is good, can enterprise be good. The healthy development of the industry is the common responsibility of all, large enterprises lead, small and medium-sized enterprises work together, all enterprises should maintain the healthy development of the industry ecology. As far as the
enterprise itself is concerned, overall consideration of short-term production and long-term operation is a necessary internal strength for the good operation of the enterprise. While pursuing immediate profits, the enterprise should also predict the future market trend and potential risks. It can not make money at present, but bury the seeds for future losses. Under
the inner volume, no one benefits. Finally, I would like to review the history and share with you in the industry.
As we all know, the settlement of cement is basically cash settlement. In fact, there were credit sales in the industry before. Later, with the joint efforts of everyone, the practice of "cash settlement" of cement was gradually formed. We should believe in our own strength, believe in the strength of the industry, and unite to get out of the predicament and achieve win-win situation. Only when
you know yourself and your enemy can you fight a hundred battles with no danger of defeat. If we can accurately grasp the data of industry production and operation demand in real time, it will be the key factor for enterprises to achieve market breakthroughs. To this end, the cement network specially launched the cement industry production data column [ Cement Observation ], which provides comprehensive, timely, accurate and reliable industry production data support for the industry. The column covers the production side of cement and clinker , the demand side of engineering projects, and macroeconomic data, providing key decision-making basis for enterprises in enterprise development, layout strategy, marketing tactics, etc.
