Guizhou Cement Thousands Of Miles Into Henan Cement Average Price Returned To The Peak Of History

Subject to freight costs, the consumption radius of cement will not exceed 200 km. However, in the Henan market in November, there appeared a scene of "fire fighting" in Guizhou cement.

"At such a distance, the freight per ton of clinker can reach 200-220 yuan, and the freight volume from Guizhou to Henan will reach 300 yuan per ton, due to the tight transport capacity, which is higher than the local factory price in Guizhou." Hou Linlin, an analyst of Zhuo Chuang information cement industry, introduced to the economic news reporters in twenty-first Century on December 3.

At that time, Henan was severely limited by the emergency warning of heavy pollution natural gas. The price of cement in Zhengzhou market once reached a high price of 750 yuan / ton. In the late period, with the cement market entering the province and the release of the limited production, the local cement fell sharply by 160 yuan / ton in the near future.

Although it is an example, changes in the whole industry can not be ignored. According to the information provided by Zhuo Chuang, the average price of bulk P.O42.5 cement in 31 provincial capitals (autonomous region capital and municipality directly under the central government) was 484 yuan / ton, slightly higher than the same period in 2018, and the peak value of average price in nearly three years.

In twenty-first Century, the economic news reporter learned that, for cement alone, there is no need to worry too much about the excessive price rise. Even if short-term prices continue to rise, but as the weather gets colder and the North stops, the price of Henan's supply and demand mismatch will rise sharply, and will not continue again for the short term. The high price of cement prices can almost be determined in this year.

What happened to Henan cement?

Hainan, which has the highest price of cement in China, is at least 100 yuan higher than that in other provinces, but it was reduced by Henan in November.

"From the end of October to the first half of November, the price of cement in Henan has risen to 200 yuan per ton, and the highest price in Zhengzhou has reached 750 yuan. Although it was only a flash in the pan, it lasted for one to two days. At that time, the mainstream of the market came to a price of 700 yuan to 720 yuan per ton. Hou Linlin said.

What is the price of more than 700 yuan? This is 200 yuan higher than that in the East China market, and it is difficult to sell this price in Hainan.

The reason is the relationship between supply and demand. First of all, from September, the cement industry entered the traditional peak season of consumption, and the price of cement in Henan has its own rising expectations.

Secondly, from late September to late November, four rounds of heavy pollution weather warning occurred in Henan, which caused the local cement production enterprises to face 5 to 10 days of discontinued production, and the supply side greatly shrank.

"Demand side key projects and people's livelihood projects have not been shut down, and the short-term supply and demand relationship is unbalanced. As a result, the extreme case of Guizhou cement entering the Henan market through the tank truck has been seen. Hou Linlin said.

Since Guizhou can transfer goods to Shandong from a long distance, the cement from Shandong, Shanxi and Shanxi will naturally take the lead. For example, the export price of Shandong Heze cement, which is adjacent to Henan, has also been raised to 600 yuan / ton.

However, with the lifting of the early warning of heavy pollution in Henan and the resumption of supply, the price of cement quickly returned. By December 3rd, the price of Zhengzhou market had dropped to 560 yuan / ton.

Judging from the national market, the "roller coaster" trend of Henan cement price is nothing more than a short-term price fluctuation caused by a mismatch of supply and demand. The price of cement in the national market in the fourth quarter of this year is relatively rational.

Compared with historical data, we can see that in 2019 1-6, the average price of P.O42.5 bulk cement in the whole country was higher than that of 30 yuan / ton in the same period last year, and the price difference narrowed rapidly in the middle of June, basically unchanged from the same period in 2018.

According to the data provided by the business community in December 3rd, the average price of 42.5 bulk cement in East China was 536 yuan / ton on that day, and the price was 539 yuan / ton during the same period last year.

"In the middle and late 8 of this year, the price of cement in East China began to rise from 460 yuan, and the rate of increase in November has accelerated, with a total increase of around 80 yuan." Li Xueying, a business analyst, said in December 3rd that the overall supply and demand relationship in East China had not changed significantly, and price fluctuations were within normal limits.

Hou Linlin holds a similar view. "Excluding Henan, other provinces and cities belong to the normal increase in the peak season of consumption."

However, as the national average price has reached the peak in recent years, it has also superimposed the same period of products such as steel and coking coal.

The high point is now in the year.

At the micro enterprise level, the cement price increase will provide basic guarantee for the listed companies' fourth quarter performance at least.

However, due to the obvious narrowing of the average price of cement and the difference in price last year after mid June this year, the growth rate of single quarter profits of cement enterprises in the four quarter may be significantly slowed down.

Take the industry leading Conch Cement (600585.SH) as an example. In the first to three quarter of this year, the net profit growth in the single quarter was 27.27%, 12.43% and 10.06% respectively.

When the cost end is relatively locked, as long as the average price of cement in the fourth quarter will not exceed that of the same period last year, the profit growth of conch cement will be unchanged in the three quarter.

It should be pointed out that, because the income scale of conch cement from Eastern, central and western regions is not large, the consistency between performance change and cement price fluctuation is the strongest, and the cement enterprises in other regions will have very obvious differences in the four quarter.

The strongest trend is that "the south is strong and the north is weak", and the north is affected by weather factors.

On the earnings report, the income and profit scale of the northern cement production enterprises will decrease sharply during the quarter, which can be seen from the historical achievements of the relevant listed companies. The overall characteristics of the first quarter and fourth quarter are low, and the two or three quarter rebound.

"December is still in the peak season, and the demand in the north is decreasing obviously. In the key markets of the south, there may be a rainwater cooling weather in the two lakes and the Yangtze River Delta, thus inhibiting the downstream demand. Guangdong and Guangxi may continue to stop until a week before the Spring Festival, and the demand side is limited." Hou Linlin said.

She predicted that even if the heavy pollution weather warning again occurred in Henan, prices would not rise again. "The Spring Festival is earlier this year, and the demand ended earlier than before."

Therefore, after the agitation of November, the price of domestic cement has no room for further sharp rise, which overlay the weakening effect of demand side. Although the price of cement in some areas is still high, the high point has been formed in this year.

In the medium to long term, the national average price close to 500 yuan is also at an absolute high level. Taking the Shanghai market as an example, the price in the four quarter of 2015 was only 150 yuan / ton, which has now doubled 3 times.

"Including infrastructure and property market, there is no obvious change in demand side next year." Li Xueying said.

In fact, in recent years, price analysis is mainly based on supply orientation. From this year's production enterprises to be exempt from production, and the operation of burden reduction, the supply side's release trend is very obvious. Hou Linlin said.