Economic Operation Analysis of China Flat Glass Industry in 2018 and Trend Forecast in 2019
In 2018, China's flat glass industry has undergone structural reform on the supply side. The industry's economy has been running smoothly, economic benefits have been improved, and the industrial structure has been further optimized.
Production continues to grow
In 2018, the output of flat glass was 870 million boxes, an increase of 2.1% over the previous year. One of the important reasons for the smooth development of flat glass industry is the accelerated transformation of consumption and emerging markets. The output of ordinary building glass decreased from 47.4% in 2014 to 35.6% in 2018, while the output of low-radiation glass, electronic glass and solar glass increased considerably in varying degrees.
Regionally, Hebei, Guangdong, Hubei, Shandong, Sichuan, Fujian, Liaoning, Zhejiang, Jiangsu and Tianjin are the top ten provinces of flat glass production in China in 2018. Among them, Hebei Province is the only region with output exceeding 100 million weight boxes.
The factory price is rising steadily
In 2018, glass prices showed a trend of rising first and then depressing. Under the strict control of new production capacity in 2017, glass prices in the first quarter of 2018 out of the rare warm winter market, into the second quarter of a short backward, the overall upside of a wave of shocks, after entering September, the price center began to move downwards, and at the end of the year fell to the lowest level. Overall, flat glass prices have steadily risen, with an average ex-factory price rising by 3.8% over the same period last year. In December, the ex-factory price was 75 yuan/weight box.
Economic benefits have been improved markedly
In 2018, the main business income of flat glass industry reached 76 billion yuan, an increase of 7.2% compared with the previous year, and the total profit reached 116 billion yuan, an increase of 29.1% compared with the previous year, the largest increase in recent years. Flat glass has achieved better benefits in recent years. On the one hand, it benefits from the continuous improvement of innovation ability, the expansion of market application fields and the expansion of scale of key enterprises in the industry. On the other hand, it benefits from the strengthening of supervision by industry management departments, tightening the new capacity barrier and maintaining the basic balance between supply and demand in the market.
Effective mitigation of the contradiction of overcapacity
From 2015 to 2018, the capacity increment of flat glass industry has been decreasing year by year. Especially after the issuance of Notice on Serious Capacity Replacement and Strict Prohibition of New Capacity Increase in Cement Flat Glass Industry in 2018 (Lianyuan, ICT, No. 58), the slowdown of capacity growth is more obvious. According to the publication of production line list and the statistics of glass associations in various provinces, there are 334 flat glass production lines in China by the end of 2017, with an annual capacity of 1.23 billion weight boxes, and a capacity utilization rate of 71% in 2018. The serious contradiction of excess production capacity has been effectively alleviated.
In 2019, the macro environment faced by the flat glass industry is generally stable. Driven by new real estate projects and energy-saving renovation of existing buildings, the field of building glass is expected to remain stable. Photovoltaic glass, transportation glass, agricultural facility glass and so on will maintain growth. However, structural contradictions such as overcapacity still exist, and downward pressure of the industry is still large. The whole industry needs to continue to push forward the structural reform of supply side, strictly implement the replacement of equal or reduced production capacity, strictly prohibit new production capacity, make more use of market-oriented and legal means to promote the withdrawal of backward production capacity in accordance with regulations, at the same time, constantly promote the technological progress of the industry, strengthen the supervision of non-standard glass quality and inferior petroleum coke fuel, implement intelligent manufacturing and green manufacturing, and accelerate the cultivation of new ones. Use the field and market growth point to continuously improve the quality and efficiency of development, and promote the industry towards high-quality development.