Since the State Council issued Document No. 41 in 2013, the number of new cement clinker production lines put into operation in China has significantly decreased every year. After Document No. 34 in 2016, the number of new production lines put into operation each year has further decreased, and policies have continuously raised the threshold for capacity replacement. However, the impulse of enterprises and local economies to build new production lines has not been completely suppressed. From 2017 to 2022, domestic capacity replacement is still surging. During this period, there were a total of 117 new ignition cement clinker production lines in China, with a total designed production capacity of 167 million tons. Calculated by kiln diameter, the actual production capacity was 172 million tons, accounting for 9.58% of the end of 2022 production capacity. It remains to be determined whether nearly one tenth of the production capacity has been "transformed" through capacity replacement, which is a leading "pioneer" on the road to technological upgrading, or a heavy "stroke" in reducing production capacity in the future. This article only presents data on where the newly ignited cement clinker comes from and who is under construction, for industry reference!
The distribution of new ignition production lines is the highest in 23 provinces and Guangxi
Between 2017 and 2022, 80% of the newly ignited clinker production lines are located in the southern region and 20% are located in the northern region based on production capacity scale. Among the southern regions, the central and southern regions accounted for 33%, the southwest regions accounted for 27%, and East China accounted for 21%; In the northern region, the northwest accounts for 10%, the north accounts for 5%, and the northeast accounts for 4%. The central southern and southwestern regions are under significant pressure from new ignition clinker production lines, with the total production capacity of the two regions accounting for over 12% of the total production capacity at the end of last year; The pressure from the New Line in North China and Northeast China is relatively small.
Table 1: Production capacity of new ignition clinker production lines in six major regions from 2017 to 2022
Data source: Cement Big data of China Cement Network（ https://data.ccement.com/ ）
From a specific province perspective, the newly ignited clinker production lines from 2017 to 2022 were distributed in 23 provinces and cities, with Guangxi ranking first in terms of production capacity scale and quantity in the country. Over the past six years, a total of 20 clinker production lines were put into operation in Guangxi, with a total production capacity of 29.853 million tons, accounting for 17% of the total production scale in China over the past six years; Yunnan and Guizhou followed closely, accounting for 17.4375 million tons (15) and 15.19 million tons (11) respectively, accounting for 10% and 9% respectively; Guangdong, Hunan, Fujian, Jiangxi, and Tibet have a new ignition production capacity of over ten million tons; Eight provinces and cities, including Beijing Tianjin Shanghai, Jiangsu, Henan, Hainan, Chongqing, and Qinghai, have no clinker production lines put into operation. According to the proportion of new ignition production capacity to the production capacity at the end of last year, the new ignition production line has had a significant impact on Tibet (69%), Guangxi (29%), and Fujian (21%).
Figure 1: Distribution of new ignition clinker production capacity from 2017 to 2022
Data source: Cement Big data of China Cement Network（ https://data.ccement.com/ ）
China has the most new ignition production lines for building materials and Hongshi cement
According to statistics, from 2017 to 2022, a total of 73 cement enterprises (groups) have built and put into operation new cement clinker production lines. Among them, both China Building Materials and Red Lion Cement are far ahead in terms of the total production capacity of new ignition production lines and the number of new ignition production lines, ranking first and second in the country. They have ignited and put into production clinker production capacity of 23.25 million tons and 18 million tons, respectively, accounting for 13.5% and 10.4% of the country's total, accounting for 24%. The number of production lines exceeds 10, far higher than the other 71.
In the list of "2022 Top 10 Cement Clinker Production Capacity in China" released by China Cement Network in 2022, Tianrui Cement and Asia Cement Corporation have not put into production any new clinker production lines in 2017-2022. The production scale of Huaxin Cement, Jinyu Jidong, Taini Cement, China Resources Cement and Shanshui Group is all below 6 million tons, with a total of 22.01 million tons, which is less than one of China Building Materials. The total capacity of new ignition clinker of the top ten enterprises is 63.26 million tons, accounting for 37%.
Table 2: Scale of New Ignition Clinker Production Capacity of Top Ten Domestic Enterprises in the Last Six Years
Data source: Cement Big data of China Cement Network（ https://data.ccement.com/ ）
In addition to the top ten enterprises, there are 12 enterprises (as shown in Table 3), including Tapai Group, Western Cement, Heshan Tiger Eagle and Rohdea japonica, whose new ignition clinker production capacity exceeds 2 million tons, and Tapai Group and Western Cement exceed 5 million tons.
Table 3: List of companies with new ignition production capacity exceeding 2 million tons, excluding the top ten companies
Data source: Cement Big data of China Cement Network（ https://data.ccement.com/ ）
The above 12 enterprises have a total of 25 ignition clinker production lines, involving a clinker production capacity of 42.84 million tons. Adding in the top 10 enterprises, a total of 106 million tons were put into operation, and another 53 enterprises each put into operation one clinker production line, involving a clinker production capacity of 66 million tons.
The replacement line has limited effect on improving the concentration of clinker production capacity
The author believes that although the production line constructed through reduction or equal displacement has increased the production scale and technical level of a single line, it has little effect on enhancing the concentration of the cement industry. Most of the new ignition clinker lines from 2017 to 2022 came from outside of the top ten enterprises. Small and medium-sized enterprises have significantly narrowed the technological gap with the top ten enterprises through capacity replacement, and some enterprises have taken advantage of this opportunity to expand, which is actually very detrimental to the improvement of concentration. In the past six years, most of the top ten enterprises, such as Conch Cement, Huaxin Cement and China Resources Cement, have not replaced a large amount of capacity through acquisition or self owned capacity indicators, or responded positively to the situation of overcapacity, or changed from scale expansion to high-quality development.
At present, the cement market in the northern region has already broken the platform period, while the southwest market in the southern region is closely following. With the approaching peak population in East, Central, and South China, the breaking of the national cement demand platform period will be within reach, and new measures to reduce production capacity urgently need to be taken.
(Editor in charge: Anonymous)
Article source: China Cement Network
