China's petrochemical manufacturing industry should be alert to market fluctuations
China Drying Network News has introduced measures to ensure growth and promote stability throughout the country. Some government officials and people in the economic community are optimistic that in the second half of the year, the Chinese economy will rebound with a series of stimulus policies. Many people in the petrochemical industry believe that these measures will stimulate market demand, and the petrochemical industry will benefit from it and achieve stable growth. However, this kind of optimistic judgment is somewhat wishful thinking. The Chinese economy will not be optimistic in the second half of the year. The overall product performance and corporate performance of the petrochemical industry will not be better than in the first half of the year. From the perspective of foreign trade, the EU, the United States, ASEAN, and Japan are China's most important trading partners. Due to the problems in the top floor design of the Eurozone itself, only the fiscal policy without monetary policy and exit mechanism is not perfect, and this top-level design problem cannot be fundamentally resolved in 3 to 5 years, and the economic recovery process in the Eurozone will be very slow. China to the European Union The export will be difficult to enlarge. In July, the total exports of the petroleum and chemical industries fell by 11.3% year-on-year, an increase of nearly 11% from the previous month. The United States, China’s second largest trading partner, significantly increased the policy tilt and investment in the real economy after the financial crisis in 2008. The demand for commodities from China and other countries and regions has a slowing trend. In particular, the large-scale development of shale gas in the United States has triggered a continuous decline in the prices of its resources and energy products. The downward movement of related product prices will have a major impact on China’s petrochemical products that have long been won with low prices, and have already and will continue to affect Chinese exports. As far as the domestic market is concerned, real estate, infrastructure construction and manufacturing investment account for more than 80% of China’s total investment. However, the real estate industry is affected by the national regulatory policies and the industry’s “virtual fire†overheating. The growth rate of investment in the first half of the year has declined month by month. The second half of the year will continue to fall. Taking into account the huge bubbles and potential risks in the real estate market, many financial institutions have changed their attitudes toward real estate developers from the “chasing loans†to “staring at repaying loansâ€. Under such circumstances, the investment growth of the real estate industry in the second half of the year will not only be lower than the same period of last year, and may even be lower than the first half of this year. The pulling effect of this sector on economic growth is weakening, and the demand for petroleum and chemical products is also greatly reduced. Most of the manufacturing industry has excess capacity, and the re-investment expansion will only exacerbate excess capacity and market volatility. Taking coal chemical industry as an example, most of the high-profile coal mining enterprises that entered the coal chemical industry before are rich and powerful coal mining enterprises. However, with the end of the coal industry boom, coal overcapacity, weak demand, and price declines, many coal mining companies have already forced production cuts and production cuts, liquidity is tight, bank credits have decreased, and even there has been a phenomenon of repayment. Under this circumstance, even if the country relaxes its policy restrictions on new-type coal chemical industry, the project that was originally planned or even started may have to be deferred or even stopped. How can we expect more investment growth to drive economic growth? As a pillar industry of the national economy, the petrochemical industry is highly correlated with macroeconomic trends. Although different petrochemical sub-industries will rise and fall, the overall downward pressure will be greater. Related companies should have a clear understanding of this, make preparations as early as possible and actively respond to it. Hyundai Truck,Hyundai Xcient,Hyundai Tractor Truck Chengli Special Automobile Co., Ltd. , http://www.hbfueltanks.com