Cement industry report 2006
Countries covered: China |
The sustainable development strategy for China's cement industry is part of the social sustainable development strategy. China is one of the main markets for the production and consumption of cement in the world. In 2005, China had a cement output of 1.064 billion ton, up 9.69% than 2004. In 2006, the Chinese cement production still stay within its contraction period and is most likely to grow slower than GDP, but if the investment in fixed asset can keep a steady growth, the demand for cement is still able to reach
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1.12~1.14 billion ton. The World Bank forecasts that the growth rate of the global economy in 2006 will be higher than 2005, and the international trade will greatly increase. The International Monetary Fund forecasts that the growth rate in 2006 will be the same as 2005, which still will be 4.3% and the trade growth rate will reduce to 6.5% from 9%. China's GDP growth rate was 9.9% in 2005. Some Chinese experts forecast that the GDP will rise by 8.7-9.2% in 2006. The development of the global and Chinese economy will stimulate the demand for cement, the growth will maintain between 7% and 8%, and the output will be around 1.15 billion ton in 2006.
In 2005, the global cement output was 2.27 billion ton, and it is forecasted that the global cement sale will attain 2.23 billion ton by 2010. The U.S. will continue to play the role of bellwether till 2010. It is forecasted that the cement import will achieve 30 million ton in 2010 and in 5-6 years, the global cement industry will experience a worldwide merger and reorganization, by 2010 there will be 75% of the production capacity involving in the merger tide, oversize multinational groups will be established. It is an opportunity and a challenge at the same time for the Chinese cement and concrete corporative groups.
This report researches on the Chinese cement industry's supply and demand, development, competitive status, import and export, and its prospect etc., especially the production and sale of various cement products. It also provided an analysis on the impacts that China's cement industry will face in the WTO era, and some good suggestions. This report was given on the basis of large quantity of information published by the National Bureau of Statistics, the State Bureau of Building Material, the National Development and Reform Commission, China Cement Association, the National Bulk Cement Office, various newspapers and magazines of Chinese and overseas, some cement research institutes in addition of the investigations about cement relevant enterprises made by Syntech Information Co., Ltd. This report provides access to great data about the status quo and development trend of the cement industry and offers a guide for the cement and cement relevant enterprise to make right strategies.
As we all know, cement acts as an important and fundamental raw material for national economy. Since China's implementation of Reform and Opening-up policy, China cement industry has witnessed a rapid growth. The cement output reached 1.06 billion tons in the year of 2005, accounting for about 48% of the global total. During the first three quarters of 2006, the output accumulated to 871.5479 million tons with a year-on-year growth of 20.7%. Basically, the rapid growth of cement output could meet the demand of the fast growth of national economy and the large-scale economic construction.
In spite of great achievements in China cement industry, the structural problems are conspicuously reflected here, mainly including small corporate scale, low product grade, backward production capacity, high energy & resources consumption and severe environmental pollution, etc, which not only resulted from the long-term low level industrial development, but blindness expansion of some enterprises in recent years.
To address the above mentioned issues, the document of The Notice of Several Suggestions for Accelerating Structural Adjustment of China Cement Industry was released by eight national Ministries and commissions such as National Reform and Development Commission on April 28 of 2006, so as to foster the development of large scale cement enterprises and groups. In October of 2006, the National Reform and Development Commission issued another important two documents of Special Planning for Cement Industry Development and Policies for Cement Industry Development, which actively encourages the merger and reorganization among powerful cement enterprises, so as to enhance the industrial concentration and market competitiveness.
What's more, the disappointing operation of small and medium cement enterprises and the considerable benefits of leading cement giants impress the market. The acknowledgement of successful business through merger and reorganization has been reached among cement enterprises. In 2006, further structural adjustment of cement industry was implemented. On the one hand Chinese large scale cement enterprises accelerated the acquisition step for huge benefits; on the other hand, overseas cement giants entered Chinese market for further opportunities, which resulted in a new wave of merger and acquisition in cement industry.
In the next decade, China will actively promote the structural adjustment of domestic cement industry, support the development of large scale enterprises, and improve the industry concentration. Some small and medium cement enterprise will gradually exit from the competitive market. |
