Noise from construction machinery and market differentiation

On June 1st, the State Grid Corporation of China predicted that the “electricity shortage” of “Sanhua” (North China, East China, and Central China) will spread from this summer to this winter, and even to 2013. According to the State Grid, if the contradiction between the supply and demand of thermal coal is further aggravated, and the incoming water is generally dry and there is an abnormally high temperature, the power gap in the “Three China” region will expand to 40 million kilowatts during the summer peak season; during peak winter, The "Sanhua" power gap is about 28 million kilowatts.

Duan Jiaxuan, a researcher in the China Investment Advisor Machinery Industry Group, pointed out that the shortage of manufacturing supply chains triggered by the Japan earthquake did not have a significant impact on the Chinese market. On the contrary, it created a rare opportunity for domestic brands to quickly fill positions. This power shortage is fierce and has a long duration. The impact on the construction machinery market has gradually emerged. With the advent of electricity shortages, in the case of a significant increase in the total production of steel and electricity, it is unavoidable to impose power restrictions on some steel companies.

Insufficient supply of electricity, the steel industry is the only way to limit production, once the large-scale production of iron and steel companies, the downstream construction machinery industry will face increased costs and raw material supply and other issues, this phenomenon may intensify this summer. Into the summer peak of electricity consumption, once the local government implements the electricity restriction policy on the manufacturing industry, it will inevitably affect the market supply of construction machinery products. Due to the obvious regional policies, the influence of electricity restriction policies in different regions of the industry and in different parts of the industry chain is very different.

Zhang Yanlin, research director of China Investment Consulting Co., Ltd., pointed out that the leading enterprises of construction machinery are generally the pillars of local fiscal revenue. Even if they are included in the scope of power restriction, the time for power cut is obviously less than other companies, and will not affect the production and sales of enterprises. For example, the construction machinery industry in Hunan Province is one of the ten pillar industries, and it is absolutely impossible that it will not be able to protect the company's production because of power restrictions. However, in other supporting industries, there will be supply shortages caused by power cuts. A large number of small and medium-sized enterprises cannot afford to attack the electricity shortage and production is under test.

According to the "2009-2015 China Machinery Industry Investment Analysis and Prospects Forecast Report" published by the China Investment Advisor, steel accounts for approximately 12.7% of all electricity demand. Once the iron and steel industry bears the brunt of heavy electricity restrictions, steel production will decline. The market will be in short supply, and steel prices will rise. As an upstream enterprise of construction machinery, the rise in raw materials will undoubtedly be reflected in the product price, and then grafted onto the end customers. Due to the limited size of the company, the power shortage in the past will eventually end at the expense of SMEs, and this time is no exception.