Foreword: I am very careful to write Yufeng. I used to work in a big factory, and then I started my own business. Yufeng was the first upstream manufacturer I docked with. It was the real starting point of my business. When I first entered the trade track, I relied on Yufeng to lift it. Deep in my heart, I was always grateful to this enterprise.
Writing this review, I can not strip off my personal emotions, but I will still stand in the perspective of industry witnesses to sort out its ups and downs for decades rationally and objectively, neither praise nor criticize, only restore the real development track of an old local state-owned enterprise in Guangxi.
Talking about the development history of Guangxi cement , Yufeng cement is a local legend that can not be avoided. Liuzhou Cement Plant, founded
in 1958, was the benchmark of the national cement industry in the 1980s and 1990s. With advanced technology and leading technology, numerous colleagues in South China have come to study. In terms of starting details, in the early years, Yufeng was not inferior to the conch of the same period, and steadily supported the face of Guangxi cement.
What really widened the industry gap was the golden expansion period of the industry from 2000 to 2015.
At that time, Conch and Huarun held sufficient funds, cloth factories along the Yangtze River, horse race enclosure, new dry production lines such as Xing'an, Fusui, Xingye, Guigang and Pingnan sprang up, firmly controlling the core consumer markets of Guilin, Nanning and Yulin in Guangxi and the lifeblood of Xijiang waterway export.
On the contrary, Yufeng has been restricted by strategic conservatism and historical debt for more than ten years, and its pace of development is limited everywhere. As early as the initial stage of industry expansion in 2003, Yufeng took the lead in planning the clinker project along the Pingnan River and reached a joint venture with China Resources to develop the high-quality coastline of the Xijiang River, but the heavy historical debt made the enterprise unable to continue to follow up the investment, and in 2005, it was only regrettable to withdraw from the joint venture project. Having lost the excellent opportunity to enter the main channel of Xijiang River and supply the Pearl River Delta at low cost, we can only stick to the inland factory area of Liuzhou and completely miss the best window period for large-scale expansion.
One step behind, one step passive. When the follow-up debt is gradually sorted out and the system is straightened out, and we want to take the initiative to expand, the whole high-quality riverbank, core logistics nodes and high-quality mining sites along the river in Guangxi have already been divided up by the leading enterprises, and the industry structure has been solidified.
When it was merged into Xijiang Group in 2016 and into Beigang System in 2018, Yufeng really stepped out of the shadow of historical debt, and the pressure of operation was greatly alleviated. Finally, Yufeng had spare capacity to start foreign mergers and acquisitions and capacity expansion, trying to make up for the shortcomings of location that had fallen for many years. However, the general trend has been set, the golden development period has already ended, and the difficulty of catching up has doubled.
From 2017 to 2021, it is the last boom dividend of the industry and the last highlight of Yufeng. Even if the congenital location is insufficient, it can still make stable profits. People familiar with the market know that most of the Yufeng factories are rooted in the hinterland of Liuzhou and Duan, and do not rely on the main channel of the Xijiang River, so the cost of automobile logistics is naturally higher than that of the big factories along the river. However, in those years, the market demand was strong, the price of cement continued to be strong, and the terminal profit margin was sufficient. Even if Yufeng had high freight and high comprehensive cost, it still had stable profits, market and reputation in the Pearl River Delta. I used to be the top three core distributors of Yufeng in the Pearl River Delta, and I have witnessed the prosperity of both production and marketing in recent years.
In 2021, I personally attended the Yufeng Dealer Conference, and the atmosphere was very warm. At that time, Yufeng Cement executives admitted at the meeting that the annual profit in 2020 was equal to the total profit of the company in the previous ten years. Dealers from all over the country were deeply encouraged. At that time, they were immersed in the joy of market dividends. Most people were blinded by the temporary prosperity, believing that relying on the layout of production capacity, Yufeng could firmly grasp the industry outlet and continue to strengthen.
In those years, Yufeng also actively sought change, acquired Guizhou production capacity, laid out Du'an and Luzhai production lines, and landed at Beihai Grinding Station. At that time, Yufeng had eight production lines in Guangxi, and Liuzhou, Rongan and Du'an had three large-scale clinker lines. The overall production capacity reached 10 million tons, which clearly showed the determination of enterprises to break through and seek change.
But fate has its own arrangements, and the boom cycle is fleeting. After 2022, the industry completely ushered in a watershed. With the cooling of
infrastructure construction and the centralized release of new production capacity in Guangdong and Guangxi, the industry has completely bid farewell to the market dividend and entered the era of stock volume of cost, location and water transport.
This round of cold winter is industry-wide, not Yufeng alone. Even Conch Cement, which holds Nanning, Yulin and other core consumer markets , has seen a sharp decline in profits; on the contrary, China Resources, Red Lion, Taiwan Cement, Nanfang and other industry giants are also on the verge of loss. However, these enterprises along the Yangtze River can rely on the Xijiang River water transport to reduce transport costs and barely cross the cycle, while the hard injury of Yufeng's inland location is thoroughly exposed.
The core production capacity does not rely on the river, there is no main water transportation, the export shipment is highly dependent on automobile transportation, and the cross-regional export cost remains high; Beihai Grinding Station has no supporting self-owned clinker production capacity, and the off-site production capacity in Guizhou lacks the support of the nearby terminal market, thus completely losing the export price competitiveness. When the
market is good, the short board will be covered by the high price; when the market is down, the strategic thinking is the survival gap. After 2022, Yufeng Cement completely lost its price advantage in the Pearl River Delta market, and the terminal price difference was completely upside down. In desperation, I also withdrew from the export market of Yufeng. As a dealer who relied on it to start, I was filled with unspeakable regret for the end of such a gradual departure, which was also the most biting industry experience of our terminal traders.
Looking at Yufeng, we need to be more objective and inclusive. Among the old local cement state-owned enterprises in
Guangxi, Yufeng is already a leader. In the same period, the old cement plants in Jinxiang, Gupeng, Sizhou and other places have all been shut down and withdrawn, only Yufeng sticks to it so far, retaining the complete upstream and downstream industrial chain, and stabilizing the foundation of Guangxi's local industry. In recent years, with the financial support of Beigang Group, enterprises have continued to invest in technological transformation, reduce costs and adjust the layout of regional production capacity, never lying flat and never stopping the pace of self-rescue adjustment.
But the trend of the industry is irreversible.
The golden expansion window is permanently closed, the core resources of Xijiang have already been divided up, and more technological transformation and merger and acquisition remedies in the later period can not make up for the missed opportunities of the times caused by the conservative strategy and historical debts in the early years. State-owned platforms can support enterprises to continue to exist, but they can not reverse the already established industry structure and recover the lost development window period.
Looking back at the ups and downs of Yufeng for decades, it is full of sighs.
It started brilliantly, stagnated in the medium term due to conservative layout and historical debt, failed to catch up in the later period, and eventually slowly fell behind.
I have witnessed its glory and prosperity, when I changed my identity from Party a to start a business, I also relied on Yufeng to gain a firm foothold, and I always had a kindness in my heart. Now look at it walking with difficulty, the heart is only complicated: sorrow for its misfortune, anger for its non-contention. The past scenery is no longer, it is the starting point on my way to start a business, and it is also an emotional past in my memory. The ups and downs
of Yufeng are not only the rise and fall of a cement plant, but also the old local industry in Guangxi, a real and helpless sad song of the times.
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