2024, the inventory pressure of the real estate industry remained high, the actual funds in place were further reduced, most enterprises mainly digested the inventory, lacking the willingness and ability to invest and expand, coupled with the completion of the previous "guaranteed delivery" projects, the construction scale continued to shrink, which continued to drag down the demand for concrete market.
At the same time, as local governments have increased their efforts to reduce debts, the gap between fiscal revenue and expenditure has widened, projects have been suspended and postponed in some regions, investment in roads, municipal and other fields has shown negative growth, the volume of infrastructure construction has declined significantly, and the contradiction between supply and demand in the concrete industry has intensified.
With the simultaneous weakening of housing construction and infrastructure demand, the competition among concrete enterprises is particularly fierce, and the market price continues to decline.
During this period, the upstream raw material enterprises have a strong willingness to push up, the cost of concrete production has risen considerably, the profit margin of mixing stations has narrowed significantly, and the profit margin of industry sales has dropped to a historical low level.
In addition, due to the shortage of funds in the downstream construction sector, there is no sign of improvement in the repayment situation of the concrete industry, and the risk of impairment loss is still prominent.
Overall, the demand for concrete market continued to decline sharply in 2024, and the decline in both volume and price led to a continuous reduction in the scale of industry revenue.
At the same time, due to the increasing pressure on the cost side, the profit margin of concrete sales has been eroded, and the total profit of the industry has declined significantly.
According to the total data, in 2024, the main business income of Industrial Enterprises above the scale of concrete and cement products industry is expected to reach about 1.3 trillion yuan, with a year-on-year decline of about 16%, and the total profit of the industry is expected to be about 32 billion yuan, with a year-on-year decline of more than 40%.
Figure: Changes in income and profit of concrete industry in 2024 (100 million yuan, %)
Data source: Cement Big Data (https://data.ccement.com/)
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