Since the second half of 2005, the extraordinary and rapid development of China's chlor-alkali industry has caused adverse reactions throughout the industry and has been demonstrated in the market. At present, the pace of irrational expansion of the industry has not only not stopped, but it has further accelerated the pace.
Three Powers for Rapid Expansion With the development of China's economy, China's chlor-alkali industry, which is an important basic chemical raw material, is also showing increasing development year by year. However, since 2004, the development trend of China's chlor-alkali industry has been rapid, and the expansion of production has led to a significant increase in capacity growth. There are three main reasons for the rapid expansion of China's chlor-alkali industry:
First, as the world economy resumes its growth, the chlor-alkali industry has entered a short-lived glorious period and stimulated an upsurge in expansion of the chlor-alkali industry. Since 2003, the world economy has begun to recover. The chlor-alkali industry as a basic chemical raw material also ushered in a glorious period. From 2000 to 2002, the average operating rate of world chlor-alkali industrial installations was still below 80%. In 2004, the average operating rate of world chlor-alkali industrial installations reached 86%, and reached 100% in most of the time. It is the best year in the history of the chlor-alkali industry. one. Therefore, since 2004, the world's chlor-alkali industry has experienced a round of capacity expansion.
Second, the world's chlor-alkali industry has shifted to Asia, especially China. The chlor-alkali industry is an industry with high energy consumption, low added value, and certain environmental impact. With the gradual rise in oil prices and the increase in environmental pressures in Europe and the United States, these regions have gradually reduced their chlor-alkali facilities. The shift is oriented toward fast-paced market demand and relatively low production costs in Asia. China Mainland.
Third, China has entered the stage of heavy chemical development. Local governments have set off an upsurge of heavy chemical investment. The reform and opening up started in 1978, which gradually moved China from the direction of light industry to the stage of industrialization. After more than two decades of development, China’s industrialization is no longer able to withstand the rapid economic growth. Therefore, heavy chemical development ideas have begun to lead China’s economic development. Heavy chemical industry can cater to the high value of fixed assets investment, high employment, and other government values, and thus has become a “major event†for local governments to revitalize the local economy. With the support of the government, various localities have launched large-scale chemical projects, especially in areas with coal resources and salt resources in the central and western regions, and they have made the chlor-alkali industry a pillar industry that exploits local resource advantages.
Chlor-alkali industry dilemma
From the second half of 2005, China's chlor-alkali industry has entered an era of oversupply. By the first half of 2006, most of the products in the chlor-alkali industry were in a position of low profit or loss. In order to find a way out and resolve the pressure on the domestic market, companies have begun to export themselves without being prepared. However, the export market has just opened a small door, it has provoked anti-dumping investigations in many countries, and the export road is full of thorns.
The brilliance of the entire industry was still in sight in 2004, but just over a year later, the chlor-alkali industry in China has entered a predicament. The main reasons for this are the following.
First, expansion of the expansion of the chlor-alkali industry has been tied to the carriage of government investment in fixed assets, and it is difficult to stop it. At present, China's chlor-alkali industry has exceeded supply, but it can not prevent this situation from continuing to worsen. The main reason is that expansion of the chlor-alkali industry is the majority of government demand, and can not fully reflect the real market demand of the industry. Therefore, the chlor-alkali industry is not so much a stage for companies to compete, it is better to say that it is a stage for the governments of all regions to compete. In this kind of competition, the enterprise's initiative is greatly reduced.
Second, the ethylene process is facing a shortage of oil resources and the calcium carbide process is facing environmental issues. China is the only country in the world in the chlor-alkali industry that has two process PVCs. The calcium carbide process does not exist in other countries. On the one hand, China has abundant calcium carbide resources. On the other hand, oil resources are relatively scarce. Therefore, the scale of the calcium carbide process can exceed the scale of the ethylene process. The government weighs in the development of environmental protection and the care of the central and western regions. It is impossible to completely eliminate the calcium carbide process in a short period of time. This, to a certain extent, causes the current two process PVC companies to be subject to some constraints, indirectly resulting in the current difficulties.
Third, companies are passive in the irrational development of this industry and their initiative is not enough. China's chlor-alkali industry is dominated by state-owned enterprises, so it is greatly affected by the government, and the decision-making space of the enterprise itself is limited. The development of the industry is based on the merger of dominant companies to eliminate disadvantaged enterprises, and finally reach a certain degree of industrial concentration, thereby reducing the industry's blind disorder and mature. When the initiative of the enterprise is not enough, the function of the survival of the fittest will not appear in the market, then this industry will continue to chaotic disorderly competition.
The industrial structure needs to be optimized Due to the complexity of the chlor-alkali industry in China, it is necessary to work out the difficulties and also need to combine various related factors to jointly exert strength.
First, the state needs to use policies to strictly control local governments' blind projects; secondly, industry associations need to organize and discuss the development of the industry as a whole, so that the sense of crisis can be deeply felt in the company's minds; and thirdly, companies need to take initiative to avoid the problems and avoid new developments. Repeated low-end competition.
In the future, the industrial structure of China's chlor-alkali industry should be a market competition pattern with regional and functional enterprise groups as the main body. By then, two types of enterprises will be competitive in the market. One type is an enterprise that has the advantages of both production raw materials and production costs, and develops into a large-scale production-type chlor-alkali enterprise integrating the industrial chain; the other type is a company in a region with special resources, such as close to the largest consumer market, or Close to large-scale ports, it mainly develops service-oriented businesses and grasps the right to speak in certain international and domestic circulation markets.
Three Powers for Rapid Expansion With the development of China's economy, China's chlor-alkali industry, which is an important basic chemical raw material, is also showing increasing development year by year. However, since 2004, the development trend of China's chlor-alkali industry has been rapid, and the expansion of production has led to a significant increase in capacity growth. There are three main reasons for the rapid expansion of China's chlor-alkali industry:
First, as the world economy resumes its growth, the chlor-alkali industry has entered a short-lived glorious period and stimulated an upsurge in expansion of the chlor-alkali industry. Since 2003, the world economy has begun to recover. The chlor-alkali industry as a basic chemical raw material also ushered in a glorious period. From 2000 to 2002, the average operating rate of world chlor-alkali industrial installations was still below 80%. In 2004, the average operating rate of world chlor-alkali industrial installations reached 86%, and reached 100% in most of the time. It is the best year in the history of the chlor-alkali industry. one. Therefore, since 2004, the world's chlor-alkali industry has experienced a round of capacity expansion.
Second, the world's chlor-alkali industry has shifted to Asia, especially China. The chlor-alkali industry is an industry with high energy consumption, low added value, and certain environmental impact. With the gradual rise in oil prices and the increase in environmental pressures in Europe and the United States, these regions have gradually reduced their chlor-alkali facilities. The shift is oriented toward fast-paced market demand and relatively low production costs in Asia. China Mainland.
Third, China has entered the stage of heavy chemical development. Local governments have set off an upsurge of heavy chemical investment. The reform and opening up started in 1978, which gradually moved China from the direction of light industry to the stage of industrialization. After more than two decades of development, China’s industrialization is no longer able to withstand the rapid economic growth. Therefore, heavy chemical development ideas have begun to lead China’s economic development. Heavy chemical industry can cater to the high value of fixed assets investment, high employment, and other government values, and thus has become a “major event†for local governments to revitalize the local economy. With the support of the government, various localities have launched large-scale chemical projects, especially in areas with coal resources and salt resources in the central and western regions, and they have made the chlor-alkali industry a pillar industry that exploits local resource advantages.
Chlor-alkali industry dilemma
From the second half of 2005, China's chlor-alkali industry has entered an era of oversupply. By the first half of 2006, most of the products in the chlor-alkali industry were in a position of low profit or loss. In order to find a way out and resolve the pressure on the domestic market, companies have begun to export themselves without being prepared. However, the export market has just opened a small door, it has provoked anti-dumping investigations in many countries, and the export road is full of thorns.
The brilliance of the entire industry was still in sight in 2004, but just over a year later, the chlor-alkali industry in China has entered a predicament. The main reasons for this are the following.
First, expansion of the expansion of the chlor-alkali industry has been tied to the carriage of government investment in fixed assets, and it is difficult to stop it. At present, China's chlor-alkali industry has exceeded supply, but it can not prevent this situation from continuing to worsen. The main reason is that expansion of the chlor-alkali industry is the majority of government demand, and can not fully reflect the real market demand of the industry. Therefore, the chlor-alkali industry is not so much a stage for companies to compete, it is better to say that it is a stage for the governments of all regions to compete. In this kind of competition, the enterprise's initiative is greatly reduced.
Second, the ethylene process is facing a shortage of oil resources and the calcium carbide process is facing environmental issues. China is the only country in the world in the chlor-alkali industry that has two process PVCs. The calcium carbide process does not exist in other countries. On the one hand, China has abundant calcium carbide resources. On the other hand, oil resources are relatively scarce. Therefore, the scale of the calcium carbide process can exceed the scale of the ethylene process. The government weighs in the development of environmental protection and the care of the central and western regions. It is impossible to completely eliminate the calcium carbide process in a short period of time. This, to a certain extent, causes the current two process PVC companies to be subject to some constraints, indirectly resulting in the current difficulties.
Third, companies are passive in the irrational development of this industry and their initiative is not enough. China's chlor-alkali industry is dominated by state-owned enterprises, so it is greatly affected by the government, and the decision-making space of the enterprise itself is limited. The development of the industry is based on the merger of dominant companies to eliminate disadvantaged enterprises, and finally reach a certain degree of industrial concentration, thereby reducing the industry's blind disorder and mature. When the initiative of the enterprise is not enough, the function of the survival of the fittest will not appear in the market, then this industry will continue to chaotic disorderly competition.
The industrial structure needs to be optimized Due to the complexity of the chlor-alkali industry in China, it is necessary to work out the difficulties and also need to combine various related factors to jointly exert strength.
First, the state needs to use policies to strictly control local governments' blind projects; secondly, industry associations need to organize and discuss the development of the industry as a whole, so that the sense of crisis can be deeply felt in the company's minds; and thirdly, companies need to take initiative to avoid the problems and avoid new developments. Repeated low-end competition.
In the future, the industrial structure of China's chlor-alkali industry should be a market competition pattern with regional and functional enterprise groups as the main body. By then, two types of enterprises will be competitive in the market. One type is an enterprise that has the advantages of both production raw materials and production costs, and develops into a large-scale production-type chlor-alkali enterprise integrating the industrial chain; the other type is a company in a region with special resources, such as close to the largest consumer market, or Close to large-scale ports, it mainly develops service-oriented businesses and grasps the right to speak in certain international and domestic circulation markets.
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