According to the data of the National Bureau of Statistics, from January to November 2023, the national cement output was 1.867 billion tons, down 0.9% from the same period last year. As a major province of cement production in China, the decline of cement output in Henan in 2023 was even more serious. Wang Aizhen
, president of
Henan Building Materials Industry Association, said in an exchange with China Cement Network that from January to November 2023, the cement output of Henan Province was 89.791 million tons, down 5.8% from the same period last year, much higher than the national average. In terms of
price, since this year, the overall market in Henan has been depressed, and the price of cement in some areas once fell below 200 yuan/ton. Especially from late May to early August 2023, Henan cement prices almost showed a downward trend all the way. After entering the traditional peak season, the overall cement price has been raised several times, but the difficulty of implementation has increased significantly compared with previous years.
Wang Aizhen said that in 2023, the vast majority of cement enterprises in Henan Province were in a loss state due to the decline in demand and the downturn in the market.
Talking about the reasons for the current situation, Wang Aizhen believes that the core problem is the serious overcapacity of Henan cement and the "intrigue" among enterprises in the region. On the
demand side, the cement market in Henan relies heavily on real estate, but the real estate industry in Henan will further decline in 2023.
The data show that the real estate investment in Henan Province from January to November 2023 was 386.875 billion yuan, a decrease of 243.7 billion yuan compared with the same period in 2022, a decrease of 9.2% compared with the same period in 2022, of which the residential investment was 334.821 billion yuan, a decrease of 202.895 billion yuan compared with the same period in 2022. Down 8.5% year on year.
In addition, from January to November 2023, the construction area of real estate in Henan Province was 51734 91000 square meters, a decrease of 53.9776 million square meters compared with the same period in 2022, a decrease of 8.5% compared with the same period in 2022; The new construction area was 52.252 million square meters, a decrease of 31.9464 million square meters compared with the same period in 2022.
On the one hand, real estate investment continues to bottom out, on the other hand, Henan's infrastructure investment can not make up for the cement demand gap caused by the downward trend of real estate.
Wang Aizhen said that although Henan has announced a large number of infrastructure plans, the pull of infrastructure on cement demand lacks "explosive force", and it takes time to implement, the local government is also facing a certain degree of financial pressure, and the actual pull of cement demand is quite limited. On the
supply side, Henan cement is facing a serious problem of overcapacity.
Wang Aizhen pointed out that even if Zhonglian Tongli, which ranks first in Henan's cement production capacity, and Tianrui Cement , which ranks second , do not produce throughout the year, the remaining enterprises can fully meet the needs of the whole province. According to the statistics of China Cement Network, the total production capacity of Zhonglian Tongli and Tianrui Cement accounts for 55.18% of Henan Province.
In the past, due to the demand, Henan, under the leadership of large enterprises, actively promoted peak staggering production, and large enterprises were able to stabilize the market situation to a certain extent after sacrificing part of the market share. But now under the serious contradiction between supply and demand, even if the two leading enterprises give up all the market, Henan cement is still surplus.
Henan cement overcapacity is so serious, in addition to the serious decline in demand, an important factor is that in recent years, local enterprises have increased production and transformation efforts, resulting in serious overproduction, the actual capacity is far greater than the design capacity. What
makes the market worse is that in the face of such a severe market situation, Henan cement enterprises are still fighting separately, and the market structure is extremely chaotic. According to the data of
China Cement Network, most of the cement clinker production lines in Henan Province are 5000 tons. Single large line cement enterprises have a strong voice in the regional market, and their business strategies are more flexible. The leading enterprises lack the right to speak in the market, and the "second echelon" enterprises have great strength and dominate one side. When the market is good, everyone can live in peace, but once the market deteriorates, it is easy to break down the relationship of competition and cooperation because of their respective interests.
Wang Aizhen said that in 2023, the number of days of kiln shutdown in Henan Province increased significantly compared with 2022, but the market situation is still depressed. The reason is that besides the prominent contradiction between supply and demand, the infighting among enterprises is an important factor.
It is understood that in 2023, 67 general cement clinker production lines in Henan Province stopped kilns for 14389 days, an increase of 21.8% over the 11818 days of the same period last year, an average of 214.8 days, an increase of 38.4 days over the same period last year; Clinker production was 60.22 million tons, down 18.3% from 73.7 million tons in the same period last year.
Talking about the situation of Henan cement market in 2024, Wang Aizhen said that due to the drag of real estate, the contradiction between supply and demand is likely to further intensify in the new year, and the price competition among enterprises may be unavoidable. If the industry can not reach a consensus on steady growth, the Henan cement market will remain difficult in the new year, and the loss may be more serious.
