Cement resumption in 2010-2011: strong demand side and rusty supply side
The share prices of Listed Companies in the cement sector are synchronized with the fundamentals. From 2010 to 2011, cement resumed trading, and the share prices of Listed Companies in the sector started in July 2010 and continued to rise until July 2011. In 2010-2011h1, the supply and demand were win-win. The dual stimulus of infrastructure and real estate led to the rise of cement production. The power supply was cut off, the supply was contracted, the contradiction between supply and demand was amplified, and the sharp rise of cement price was stimulated. Taking the price of 42.5 grade cement in East China as an example, there were two phased peaks in December 2010 and June 2011, which were 513 and 473 yuan / ton respectively, with a year-on-year increase of 60% and 51% respectively. The cement price in the 2011h1-2012h2 interval is not prosperous in the peak season, mainly due to the decline of real estate and infrastructure, the downward demand and the prominent risk of new production capacity.
2016-2021 cement resumption: super long cycle of beneficiary properties
The share prices of Listed Companies in the cement sector continue to keep pace with the fundamentals. Although the valuation has improved, it has also fallen rapidly. Cement resumed trading in 2016-2021, and the share prices of Listed Companies in the sector have been started since February 2016, The overall rise will continue until August 2020 ( Huaxin Cement Co.Ltd(600801) reaching a new high in September 2021). In 2016-2020, the real estate has a super long cycle, and the annual cement output is basically stable at the high level of 2.3-2.4 billion tons; the force on the supply side is obvious, and the "one size fits all" of environmental protection, peak staggering production and reduction replacement realize "de output" and "de capacity" At the same time, La Nina weather interfered with the rhythm of the light and peak seasons, and the price rose sharply at the end of the year. In 2021, coal prices rose sharply, power and production restrictions were repeated, and demand fell through tests. Cement prices rose sharply and fell slowly. With the decline of coal prices, the single ton profit of cement leader is still high.
Outlook 2022: pay attention to the policy inflection point and sublimate the relationship between supply and demand
In the second half of 2021, the policy statement was more positive, the correlation between the growth rate of infrastructure investment and the growth rate of cement production was low, and the correlation between the growth rate of real estate development investment was high. We judge that the short-term real estate and infrastructure investment is expected to stabilize and recover. Compared with the decline of supply and demand in the medium and long term, the cement price is expected to be high and stable. The sales area of commercial housing in China has reached 1.7 billion square meters for four consecutive years (including 1.69 billion square meters in 2017), but the problems of population aging and newborn decline have become prominent, and the real estate attraction of low-level cities or cities with net population outflow has decreased. If the sales area returns to 1-1.5 billion square meters, the national cement demand may fall back to about 2 billion tons. Assuming that 30% of production capacity continues to be cleared by means of carbon emission, the gap between supply and demand may be generated through peak staggering Production control. The endogenous force for the reduction of price volatility comes from the fact that the urbanization process is not over, and there are many and mature influencing factors on the supply side, such as the increase in the value of raw materials and coal, the restriction of new addition, the tightening of nitrogen sulfide and carbon emissions, the normalization of peak shifting production, etc.
Investment advice
Cement leading enterprises that focus on more key projects and layout green power.
Risk statement
Policy changes are less than expected; The weather changed less than expected.
