Core view
In 2022, the most important variables for the transformation of energy industry and the reconstruction of manufacturing industry are the basic variables of supply chain, and the shortage of investment and the reconstruction of manufacturing industry in 2022 are the strongest. Considering that the manufacturing industry is an organic aggregate of multiple sub industries, there are many limitations in predicting the investment in manufacturing industry from capital, capital goods and profits. We provide three main meso high-frequency variables to study and judge the manufacturing investment, namely: the price difference between hot coil and deformed steel (coil screw difference), the supply area of industrial land in Baicheng and the ratio of gold to silver. These three variables generally exclude relevant disturbances. Under the stable growth of new manufacturing, it is suggested to pay close attention to the changes of meso high-frequency variables in the future, so as to provide more forward-looking direction guidance for the study and judgment of manufacturing investment. We expect the growth rate of manufacturing investment to reach about 11.1% in 2022.
Manufacturing investment includes construction and installation works, equipment, tools and other expenses
Manufacturing investment refers to the fixed asset investment activities carried out by manufacturing enterprises. It accounts for more than 30% of the scale of fixed asset investment, corresponding to 31 sub industries in the industrial classification of the national economy. Investment in fixed assets refers to the economic activities of building and purchasing fixed assets. Fixed assets include houses, buildings, machinery, machinery, means of transportation and other equipment, appliances and tools related to production and business activities. Manufacturing investment is essentially divided into three parts: Construction and installation engineering, equipment, tools and instruments and other expenses.
As manufacturing investment involves many industries and covers a wide range of capital goods, its influencing factors are also complex, including but not limited to economic prosperity (PMI), foreign trade chain toughness (industrial export delivery value), profit level, financial availability (medium and long-term loans in manufacturing industry, equity financing in manufacturing industry), etc. Therefore, the prediction of manufacturing investment from industry, investment product type or influencing factors is facing many practical constraints and challenges. We suggest that in order to grasp the characteristics of manufacturing investment under the background of stable growth of new manufacturing, we need to fully capture the high-frequency information of meso variables. We tend to focus on the following three high-frequency variables: the price difference between hot coil and rebar, the supply area of industrial land in Baicheng and the ratio of gold to silver.
High frequency index 1: the price difference between hot coil and deformed steel bar (coil screw difference) is about 5 months ahead of the manufacturing investment
Hot rolled coil (hot coil for short) is an important kind of steel. It is a steel sector made of slab as raw material and rolled by roughing and finishing mills after heating. It has excellent properties such as high strength, good toughness, easy processing and forming and good weldability. It is widely used in shipbuilding, automobile, bridge, construction, machinery, pressure vessel and other manufacturing industries.
Rebar and hot coil belong to black steel products. Their raw material processing process is exactly the same. The process of forging from raw materials into billets is the same, but they are rolled from billets into steels with different shape characteristics. Rebar is a ribbed bar formed by hot rolling of square billet; Hot rolled coil is a kind of strip steel made of slab (mainly continuous casting slab) as raw material and heated by roughing mill and finishing mill.
Although the price trend of deformed steel bar and hot coil is highly related, due to their different downstream consumption fields, except that they will be applied to basic construction, the consumption of deformed steel bar is more focused on the steel for real estate construction, and the hot coil is more focused on the steel demand of automobile, ship and other manufacturing industries. We believe that the price difference between hot coil and deformed steel bar (coil screw difference) reflects the strength of manufacturing investment to a certain extent. From the empirical analysis, the price difference between hrb4 and hrb4 is about 350mm, which reflects the leading trend in the manufacturing industry.
High frequency index 2: the supply area of industrial land in Baicheng is about 4 months ahead of the manufacturing investment
According to the different work contents and realization methods of fixed assets investment, it can be classified into construction and installation engineering, purchase of equipment and tools and other expenses. Among them, other expenses refer to the expenses incurred in the construction and purchase of fixed assets that should be amortized into fixed assets except construction and installation works and the purchase of equipment, tools and appliances. For example: construction management fee, construction land fee, feasibility study fee, research and test fee, survey and design fee, environmental impact assessment fee, labor safety and health assessment fee, site preparation and temporary facilities fee, other fees of imported technology and equipment, engineering insurance fee, joint commissioning fee, safety supervision and inspection fee of special equipment, municipal public facilities fee, etc. From the historical law, the vast majority of other expenses are the land transfer fees paid by manufacturing enterprises. Therefore, we focus on paying close attention to the industrial land supply area of 100 large and medium-sized cities in zhoudu.
The supply area of industrial land is a forward-looking indicator of manufacturing investment. Theoretically, the weekly data of industrial land supply area in 100 large and medium-sized cities can reflect the plant construction expenditure in manufacturing investment and the supporting expenditure of subsequent construction and installation projects. At the same time, our empirical analysis also shows that the correlation coefficient between the monthly cumulative year-on-year growth rate of industrial land supply area and the cumulative year-on-year growth rate of manufacturing investment in 100 large and medium-sized cities is about 0.43. Therefore, we propose to focus on the marginal change of industrial land supply in 100 large and medium-sized cities.
High frequency index 3: the overall gold silver ratio is negatively correlated with manufacturing investment
China's economic system based on new energy consumption is gradually established. Under the guidance of the policy of "establishing first and then breaking down" of industrial policy, we believe that both sides of supply and demand will face comprehensive system reengineering, and the traditional meso variables are difficult to apply. According to our calculation, since 2017, the proportion of high-tech manufacturing industry in manufacturing investment has continued to rise. Among them, the proportion of computer and office equipment manufacturing industry will reach 10.1% in 2021.
Taking new energy and its industrial chain as an example, we should pay close attention to the demand increment of silver. On the one hand, silver is the metal with the best conductivity and thermal conductivity, which makes it an ideal metal for Cecep Solar Energy Co.Ltd(000591) batteries and electronic components of electric vehicles. New energy vehicles, especially pure electric vehicles, need silver in the application of many components, including silver sectord wires, contacts and so on. This depends on the good conductivity, oxidation resistance and corrosion resistance of silver. Due to its strong electrical characteristics and additional demand for energy management system, the silver consumption of pure electric vehicles is about 1.6-2.2 times that of traditional internal combustion engine vehicles. Second, the luminescence characteristics of silver indicate its application in renewable energy technology. In the global environment of promoting the development of carbon neutral and clean energy, the increase of photovoltaic installed capacity will become the main driving force for the rise of photovoltaic silver demand. Considering the strong industrial attribute of silver, its industrial demand is mainly used in photovoltaic and electrical fields. Globally, the output fluctuation of silver is small, and the fluctuation of silver price is more affected by productive demand. Therefore, the price change of silver reflects the production side's willingness to invest and expand production and the amount of physical investment.
Considering that the fluctuation of silver price is also affected by risk aversion, we suggest to pay attention to the indicative significance of the fluctuation of gold silver ratio to manufacturing investment. In theory, manufacturing investment is in a downward cycle, the decline of silver is faster than that of gold, and the gold silver ratio (gold price / silver price) rises as a whole. On the contrary, manufacturing investment is in an upward cycle, and silver will rise faster than gold, corresponding to the overall decline of gold silver ratio (gold price / silver price). The empirical analysis also shows that the correlation coefficient between the gold silver ratio and the year-on-year growth rate of manufacturing investment in the current month is -0.30.
The steady growth of new manufacturing is the macro main line in 2022. It is expected that the annual growth rate of manufacturing investment will reach 11.1%. At present, China's manufacturing industry is in a critical period of a new round of climbing over the threshold. As the main engine of China's fixed asset investment, manufacturing investment is expected to become the strongest variable for the steady growth of new manufacturing. We believe that the two main lines of manufacturing investment are strengthening the chain, supplementing the chain and rebuilding the industrial foundation, so as to enhance the independent controllability of the supply chain and make up for the shortcomings in the middle and upper reaches, so as to realize the structural transformation of new energy and intelligence. Q1 manufacturing investment is expected to form a high start, with an annual growth rate of 11.1%.
Risk warning: the uncertainty of covid-19 virus epidemic situation is rising; The conflict between Russia and Ukraine escalated again; Natural disasters exceeded expectations.
