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Cement industry: output demand capacity dialectical relationship

Time:

2021-09-15

The relationship between fixed asset investment and cement demand. From the perspective of time series, cement production also accelerated while accelerating fixed asset investment.

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　　Investment points:
　　The relationship between fixed asset investment and cement demand. From the perspective of time series, cement production also accelerated while accelerating fixed asset investment. From a regional perspective, the growth rate of demand for cement with high fixed asset investment is high. The short-term logic of using cement in the middle and late stages of investment may not be consistent.
　　The relationship between cement production and demand. Cement can be stored for 3 months. The short-term, such as 1 month, cement production may not be the demand. High production may mean high capacity, which does not necessarily mean high demand. However, the output of the first quarter can basically measure the demand for cement.
　　Therefore, the price of cement is not determined by fixed asset investment and cement production growth, especially in the short term of one month. The price of cement is determined by capacity and demand. The judgment of short-term demand needs to be combined with the comprehensive measurement of capacity and output. The short-term judgment of fixed-asset investment is of little significance.
　　In the first quarter, fixed assets investment was 29% and cement production was 13%, all showing an accelerated trend. The output growth rate reflects the growth rate of solid investment demand, and the second reflects the 24% increase in new dry process capacity in 2008. This led to a year-on-year and current cement price in the country compared to the same period last year.
　　The increase in the chain from March to the beginning of April was weaker than that of the same period of last year. The main reason is that the growth rate of this year's production is lower than that of the previous year and the peak season. In the context of increasing production capacity, it is not enough to raise the price, that is, the demand has not been enough to reduce the storage ratio and Increase capacity utilization to a critical point.
　　The current cement prices in parts of East China and South China are lower than the same period of the previous year, mainly because the growth rate of cement production is much lower than the growth rate of production capacity, which is caused by the deterioration of supply and demand. The increase in the output of the chain was lower than that of the same period of last year, which led to a decrease in the cement price in March this year.
　　In the first half of April, the low-grade and clinker prices in some of the above areas were slightly increased. One was due to the technical rebound caused by the huge price drop in the industry; the second was that the cement demand in April was slightly better than that in March, and the rural market started to cause some storage capacity ratio to reach The tipping point of the enterprise to try to raise prices.
　　In April of last year, there was a significant increase in volume compared with March, but the amount of magnification in May was not obvious in April. It is expected that the cement price will remain at an equilibrium level in May, which is only slightly better than April and the overall April-May. After the technical increase in the loss-making area, the price will be stabilized, and some areas will first have a potential for price increases.
　　This week, Qinhuangdao 6000 Datong Datong Excellent Mix, 5500 Dakar Shanxi Excellent Mix Coal prices continued to rise by 10 and 8 yuan respectively after rising last week. The coal prices in the 16 provinces and districts were mostly the same as in previous weeks, while Inner Mongolia and Liaoning fell by 15 and 20 yuan, and Henan rose by 20 yuan.
　　Except for some regions, the national price of cement in the second quarter will be better than that in the first quarter. The uncertainty or risk factor is coal price. Contains considerable expectation that cement valuations will increase or will be affected by liquidity fluctuations and enthusiasm partially transferred to consumer goods and other valuations of cheaper investment products.