In 2023, due to the decline in demand and low cement prices , many small cement enterprises suffered serious losses, and some grinding stations were insolvent and went bankrupt.
In 2024, according to the forecast of China Cement Network Big Data Research Institute, the demand for cement will continue to decline, while the production capacity of clinker on the supply side will increase, the contradiction between supply and demand will be highlighted, and the overall market pressure will remain high.
In addition, a number of policies issued by the cement industry will further bring higher and stricter requirements to the production and operation of cement enterprises in terms of environmental protection, energy consumption and cost. For example, GB 175-2023 "General Portland Cement", "Opinions on Promoting the Implementation of Ultra-low Emission in Cement Industry" (to be issued soon), "Benchmarking Level and Benchmark Level of Energy Efficiency in Key Industrial Areas (2023 Edition)", "Guidance Catalogue for Industrial Structure Adjustment (2024 Edition)" and a series of documents to promote "Double Carbon" action.
GB 175-2023 "General Portland Cement" regulates the amount of clinker and admixture in cement, regulates the types of admixture, and the production cost of some cement varieties has been improved. In addition, the revision of cement fineness in General Portland Cement requires cement enterprises to invest in the internal transformation of mills.
The Benchmarking Level and Benchmark Level of Energy Efficiency in Key Industrial Areas (2023 Edition) stipulates that for stock projects whose energy efficiency is lower than the benchmark level, all localities should specify the time limit for upgrading and elimination, formulate annual transformation and elimination plans, and guide enterprises to carry out energy-saving and carbon-reducing technological transformation or elimination in an orderly manner, so as to achieve the goal. Within the prescribed time limit, the energy efficiency transformation will be upgraded to above the benchmark level, and the projects that can not be completed on time will be eliminated. In principle, 25 areas, such as cement clinker, should be completed or eliminated by the end of 2025.
According to the recent energy consumption standards of cement enterprises released by some provinces, a large number of enterprises are in a state of substandard and need to be transformed urgently.
For ultra-low emissions, in November 2023, Huang Runqiu, Minister of the Ministry of Ecology and Environment, chaired the executive meeting of the Ministry, deliberated and adopted in principle the Opinions on Promoting the Implementation of Ultra-low Emissions in the Cement Industry. According to the draft issued by the Ministry of Ecology and Environment, the hourly average emission concentrations of particulate matter, sulfur dioxide and nitrogen oxides in the flue gas of cement kiln and kiln tail waste heat utilization system are not higher than 10, 35 and 50 mg/m3 , respectively. According to
the Solicitation of Opinions, by the end of 2025, about 50% of the cement clinker production capacity will be transformed; by the end of 2028, the cement clinker production enterprises in key areas will basically complete the transformation, and the whole country will strive to complete the ultra-low emission transformation of about 80% of the cement clinker production capacity. The treatment and transformation of the three major pollutants will cost twenty or thirty million yuan, which will also be a considerable investment for enterprises. It is not easy to raise funds under the "new" low profits. At the beginning of the
year, Yan Xiaofeng, Secretary and President of the Party Committee of China Building Materials Federation, went to Huaxin Huangshi Company and Green Building Materials Industrial Park for investigation. Yan Xiaofeng said that the cement industry is facing a "trough" period, which is both a challenge and an opportunity for Huaxin. He hoped that Huaxin would actively solve problems and open up new tracks in non-cement business.
Large enterprises still need to do so, not to mention the relatively weak competitiveness of small and medium-sized cement enterprises. With the increasingly stringent requirements for energy consumption and ultra-low emission, this part of the production line is facing transformation. Under the circumstances that the demand for cement is facing a "trough" period and it is still unclear when the profit will return to normal level, enterprises should take a long-term view and consider comprehensively from various aspects whether it is worthwhile to invest again.
When the input and output of transformation can not achieve the normal rate of return on investment, whether to take a step back and consider transformation may succeed in "jumping the gun" on the new track and break a new world.
