On June 26, the "2024 Conference on High Quality Development of Cement Industry" was held in Wuhan. Wei Rushan, Vice General Manager of China Building Materials Group and President of China Building Materials Co., Ltd., made a speech.
Wei Rushan said that in the past three years, with the changes in the macroeconomic cycle and the structural contradictions accumulated over a long period of time in the cement industry, the contradictions in the industry have become increasingly prominent, the operation of enterprises has become increasingly difficult, and the benefits have declined sharply. Since this year, the situation has become more severe, and the market has entered a low ebb, with a large area of losses in the first four months, until May. However, the key propositions of the industry, such as steady growth, capacity removal, optimization and upgrading, and dual-carbon transformation, have not been fundamentally solved. What about the next 5 or 10 years? We need to find the answer together.
Wei Rushan put forward three suggestions on how to stabilize the growth of the industry in the short term and how to develop with high quality in the long term:
First, improve the position and look at the steady growth with the interests of the whole industry as the priority. Focus on the common interests of the industry and explore the path of steady growth. In the face of the platform period of cement demand, any enterprise's price-for-quantity strategy will only lead to peer price reduction, and ultimately everyone will only achieve a market share reinvestment in a lower price, less profit, or even loss.
Looking back on the development of the global cement industry, the cement industry is facing a platform period of downward demand, and it is entirely possible to achieve the industry pattern of volume reduction and profit reduction through effective supply-side control.
In this regard, we need to further deepen the consensus of the industry. At present, every cement enterprise is responsible for the healthy development of the cement industry, especially large enterprises, which should not only stress the economy, but also the politics. They should take the responsibility of the country, improve their position, strengthen their confidence, unite as one, and jointly do a good job in the industry.
2. Strengthen cooperation and continuously improve the management and control level of the supply side. At present, the serious imbalance between supply and demand is the main contradiction restricting the healthy development of the industry, and the main aspect of the contradiction is concentrated on the supply side. Strengthening the management and control of the supply side is of great significance to promote the dynamic balance between supply and demand and safeguard the long-term interests of the industry. The root cause still lies in capacity reduction. In terms of capacity removal, large enterprise groups should highlight their patterns and responsibilities, give full play to their exemplary leading role, resolutely and strictly control new capacity, and intensify efforts to eliminate backward capacity.
Wei Rushan suggested that a joint working mechanism should be established on how to curb new growth, eliminate backwardness and integrate the market, communicate regularly, strengthen information sharing, strengthen overall coordination of short-board areas, solve the problem of unbalanced development of the industry, and improve the concentration of regional markets and the application of high-quality products.
In terms of output reduction, we should strengthen industry self-discipline, resolutely implement normal peak staggering production, promote the formation of a lasting dynamic balance mechanism in which demand determines supply and supply adapts to demand, strengthen the leading role of large enterprises and the organizational role of industry associations, and realize the promotion of the overall interests of the industry. At the level of
enterprise cooperation, enterprises in the whole industry should enhance the sense of community of destiny of the industry, be inclusive of each other, and consolidate and deepen the multi-level and three-dimensional communication mechanism.
3. Develop and innovate to accelerate the high-quality development of the industry. Faced with the new situation and the new normal, we must have new methods and new combinations to continue to give full play to the new quality productivity.
First, cooperation and innovation in the market, strengthening equity cooperation, it is suggested that large enterprises with the largest production capacity in the region should take the lead, and enterprises willing to receive production capacity should participate in the joint acceptance. Through cross-shareholdings, you have me and I have you. In the long run, through effective communication among enterprises, we can exchange needs in cross-regional markets and reduce information asymmetry.
Second, the innovation of technical cooperation, in the high-end, intelligent and green transformation of traditional industries, cement enterprises can exchange and share experience on new technological innovation. China Building Materials has strong scientific research strength, if you need, China Building Materials is willing to take out these technical personnel services to further contribute to the industry.
Third, the innovation of double-carbon cooperation, from the aspect of double-carbon, to solve the current problems, enhance the competitive advantage of high-quality enterprises, effectively curb production capacity, and achieve the ultimate goal of supply-side reform.
Finally, Wei Rushan called for strengthening the responsibility and taking the initiative to promote the high-quality development of the cement industry.
