Glass industry ushered in a new round of growth, multi-downstream demand is strong outstanding growth.
In recent years, with the rapid development of China's economy, the demand of glass industry in many downstream fields has shown a strong growth trend. According to statistics, the market size of China's glass industry has exceeded 100 billion yuan, and is expected to maintain a growth rateo more than 10% in the next few years. In this context, glass enterprises have increased innovation and research and development efforts to improve product quality to meet the changing market demand.
I. Market Status and Development Trend of Glass Industry
According to the latest data, the expected demand outlook for float glass in 2023 is low but the actual demand is high, and the industry's inventory is low. In 2023, float glass benefited from the policy of ensuring the completion of housing projects, and its demand was repaired. In the second half of 2022, the capacity was affected by cold maintenance and began to shrink. The supply and demand structure improved, and the industry's inventory accumulation momentum was insufficient due to the low expectation of the real estate industry. The industry's inventory was low, and the price was generally higher than last year. According to the data from Zhuochuang Information, the average price of float glass in the first 11 months of 2023 was 1,969.26 yuan/ton, up 2.9% from the full-year average price of last year. As of November 30, the total inventory of production enterprises in the key monitoring provinces was 37,080,000 metric tons, which remained at a low level.
In 2024, the expected capacity for float glass resumption is lower than that of the previous year.
1) Supply side: Since the second half of 2022, capacity has been concentrated for cold maintenance. In 2023, there were about 34 production lines with the conditions for resumption, but only 20 were actually resumed. As of December 7, 25 production lines were cold-maintained in 2023, with a combined capacity of 160,100 T/D. 32 production lines were cold-maintained and resumed in 2023, with a combined capacity of 223,000 T/D. According to the cold-maintained and resumed production cycle of 6-9 months (the 25 production lines were cold-maintained in 2023, and four have been resumed so far), it is expected that 21 production lines will resume in 2024, with a combined capacity of 136,100 T/D, accounting for 8% of the current industry's daily melting capacity of 172,650 T/D.
2) On the demand side,the continued implementation of the "Keep Housing Projects on Track" policy in 2023, the increased proportion of ready-to-move-in houses, and the active completion of real estate projects by developers are expected to drive glass demand. However, the continuous decline in new residential construction area may impact the expected completion rate, while the ongoing promotion of affordable housing and the fulfillment of housing delivery commitments may boost confidence in completion, resulting in a significant divergence in glass demand in 2024.
From the perspective of downstream application fields, glass has significant demand in real estate, furniture, automobiles, electronics, and new energy industries. Among them, the rapid development of the new energy vehicle industry has put forward higher requirements for the glass industry. For example, the ceramic coating glass required for the battery of new energy vehicles, and the safety glass used for car windows, etc. In addition, as the popularization of the Internet of Things and 5G technologies, the demand for glass in electronic products is also increasing continuously.
II. Enterprises Increase Innovation and Research and Development to Improve Product Quality
In the face of changes in market demand, Chinese glass enterprises have increased innovation and research and development efforts to improve product quality. it is understood that China's glass industry has the most advanced production equipment and technology in the world, and the quality of some products has reached the international leading level.
Taking Xinyi Glass as an example, the company has invested billions of yuan in technology research and development and equipment upgrading in recent years, and has successfully developed high-end products such as high-intensity solar glass and low-radiation glass. In addition, the company has entered new energy vehicles, electronics and other fields through acquisitions and cooperation to further expand the application market of glass.
III. Policy Support to Promote the Green Development of the Glass Industry
In recent years, the Chinese government has attached great importance to green development and has continuously increased its environmental protection policies. The glass industry, as a high-energy-consuming and high-polluting industry, is facing huge environmental pressure. To meet this challenge, glass enterprises have increased their environmental protection investment and adopted new technologies and processes to reduce energy consumption and pollution.
At the same time, the government has also provided policy support for the glass industry. For example, it has provided preferential policies in taxation, loans, and land use to encourage enterprises to carry out technological transformation and innovative development. In addition, the government has increased its support for green buildings and new energy sources, providing more market opportunities for the glass industry.
IV. Industry Competition is Intensifying, and Enterprises are Accelerating Integration
With the growth of market demand, the glass industry competition has become increasingly fierce. To improve market competitiveness, enterprises have In the background of strong demand from multiple downstream industries, glass manufacturers should step up their innovation and R&D efforts to enhance product quality to meet market demand. At the same time, the government should continue to provide support for the glass industry to promote its green development. In the fierce market competition, industry consolidation will accelerate, paving the way for sustainable development of the glass industry.
Summary:
The glass industry, as an important pillar industry of China's national economy, is ushering in a new round of growth. In the context of strong demand in many downstream areas, glass companies should increase innovation and research and development efforts to improve product quality to meet market demand. At the same time, the government should also continue to increase its support for the glass industry and promote the green development of the industry. In the fierce market competition, industry integration will continue to accelerate, is expected to achieve the sustainable development of the glass industry.