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Zhao Liyun, a reporter from the Securities Times
In the first half of this year, frequent price cuts, overflowing inventory and sluggish demand have become the cement market.FishingpoleThe main theme. Although the off-peak production is not reduced in many places in summer, under the condition of poor downstream demand, cement prices are lower than the same period last year, and the output is not as good as the same period last year.
The peak season of the cement market is approaching, and enterprises in some areas have also announced increases one after another in recent days, but analysts believe that in the case of sluggish demand, there is limited room for cement prices to rise, and the profit level for the whole year will be weaker than last year.
Prices keep going down.FishingpoleAt the same time, the output of cement is not as good as before. According to the data released by the National Bureau of Statistics, the domestic cement output in June was 1.Fishingpole.9.6 billion tons, down 12% from the same period last yearFishingpole.9%. The cumulative cement output from January to June was 977 million tons, down 15% from the same period last year.
In the first half of 2022, cement production in nine provinces and cities fell by more than 20% compared with the same period last year, Jilin by 45.68%, and Shanghai, Heilongjiang, Guizhou and Beijing by 30.92%.
Chen Berlin, deputy secretary general of the China cement Association and president of the Digital cement Network, analyzed that in the first half of the year, the national cement output reached an 11-year low, the market demand decreased significantly in the same period, and the relationship between supply and demand was seriously out of balance.
Judging from the monthly trend, in the first quarter, due to the multi-point spread of the epidemic and the lack of funds for engineering projects represented by real estate, the slow recovery of construction, strict control of the superimposed epidemic, poor road transportation, and overall depressed market demand, led to a double-digit decline in national cement production in the first quarter compared with the same period last year. In the second quarter, there should have been a traditional peak season, but due to multiple adverse factors such as strict control in areas with recurrence of the epidemic, poor road transport, and limited movement of people, the real estate downturn continued and the decline in cement production widened. In particular, the growth rate of cement production in April and May fell to-18.9% and-17% year on year, the lowest level in the same period in history.
After entering July, some areas tried to raise prices.
According to China cement Network, demand prices across the country have been operating weakly and steadily recently, with the weather in Rain Water in the south decreasing and demand in some areas slightly improving. The market in the Yangtze River Delta in East China has begun to try to push up the price by 20,030 yuan per ton. The main manufacturers in Henan Province in the central region also notified the whole province on July 16 to increase the cement price by 30 yuan per ton, but the actual transaction price was only about 10 to 20 yuan per ton.
"although some regions are trying to raise prices, the pressure is still great. Inventory is a problem on the one hand, even if inventory is reduced, demand is still not good enough to support the price upward. " Wang Qi said that although the kiln shutdown at off-peak in many areas is stronger than last year, the inventory of cement companies this year is still higher than that of the same period last year under sluggish demand. At present, the clinker storage capacity ratio is about 73%, compared with about 60% in the same period last year, and some areas are currently full.
The price is low, and cement enterprises in some areas have lost money. Although the average price of cement in the first half of the year is slightly higher than that in the same period last year, due to the sharp rise in coal costs and the increase in cement production costs, the efficiency of the industry has declined significantly. Industry efficiency is expected to decline by nearly 50% in the first half of the year compared with the same period last year, and the decline of enterprise efficiency in the southern provinces will be even greater.
For the second half of the year, Chen Berlin believes that the most difficult period in the industry may have passed, volume and price have a rebound basis. In the second half of the year, with the relief of epidemic prevention and control in various places, the government will refocus on steady growth, make every effort to expand domestic demand, and play the key role of effective investment, infrastructure investment will continue to increase, and overfallen demand will be repaired to support the increase in cement demand. at the same time, considering that new real estate construction is still weak, cement demand is expected to be flat or grow slightly in the second half of the year compared with the same period last year.
He believes that after the overfall in cement prices in June, cement prices in various regions will bottom in July, and as downstream demand gradually improves, and enterprises step up their implementation of off-peak production from July to August, rigid and accurate off-peak production will lead to a decline in inventories, and cement prices are expected to rise in repair one after another.
Wang Qi, an analyst at Zhuochuang, believes that cement companies are trying to raise prices recently because of high cost pressure, companies have lost money, and prices have bottomed out. However, in this case, it remains to be seen whether the price increase can hit the ground and whether it can last. Without the support of demand, the room for price increase is also very limited. Although coal prices rose sharply in the second half of last year, cement prices also rose significantly in the same period, so the industry profit for the whole year is still at a high level. By comparison, the profitability of this year's industry is definitely not as good as that of last year.