The resumption rate of railway projects exceeded 90%. Infrastructure investment increased to increase cement demand

The resumption rate of railway projects exceeded 90%. Infrastructure investment increased to increase cement demand

Source: China Business network

Original title: The resumption rate of railway projects exceeds 90%. Infrastructure investment increases the demand for cement

Lu Bingyang reports from Beijing


Up to now, the resumption rate of railway projects under construction has exceeded 90%. Ordinary national and provincial trunk roads and other water transport projects have not resumed work and strive to resume work before March 15. China National Railway Group Limited and the Ministry of Transport recently released the above ews.

Since March, 17 key railway construction projects undertaken by China Railway Shanghai Bureau Group Co., LTD. (hereinafter referred to as "Shanghai Railway Bureau") have resumed work, accounting for more than 90% of the projects under construction, and other projects strive to resume work in early March. In addition to the Shanghai Railway Bureau, the Beijing-Xiong Intercity Railway, Beijing-Tang Railway, the first phase of the intercity railway liaison line, Jinxing Railway, the total mileage of about 163 kilometers resumed work.


China Railway Guangzhou Bureau Group Co., Ltd. undertakes a total of 181 Zhangjihuai railway resumption of work, the project has completed 93.8% of the tunnel project, 77.5% of the bridge project, and the main project in front of the station is basically completed in 2020. In addition, key national high-speed rail projects in the Guangdong-Hong Kong-Macao Greater Bay Area, such as the Nansha Port Railway and the Guangzhou-Shanwei Railway, the Taiyuan-Jiaozuo high-speed railway project, the Guangxi section of the Guinan high-speed Railway, the China-Lanzhou Railway, the Lanzhang-Third and fourth Lines, and the Jiuyi Railway have been fully resumed.

On March 4, the Ministry of Transport issued the "Notice on Further Improving the Epidemic Prevention and Control of Highway and water transport Projects and Promoting the Resumption of Work in an orderly and precise Manner" (hereinafter referred to as the "Notice"), which also requires that in addition to key epidemic prevention and control areas and cold weather areas, highways and key water transport construction projects should increase the resumption of work; At the same time, the notice stressed that it is necessary to accelerate investment and construction and organize the implementation of alternative projects in the 13th Five-Year Plan. A number of construction projects supporting the implementation of the national strategy and in line with the direction of the 14th Five-Year Plan have been launched in advance.

The resumption of infrastructure projects has increased investment and increased demand for cement. Cicc recently released a research report that by the impact of counter-cyclical adjustment and high rhythm of rush work, the annual demand for cement in 2020 is expected to increase by 5%, and industry profits are expected to achieve moderate growth. On the supply side, CICC believes that the cement capacity replacement project may be delayed due to the impact of the epidemic.

In the context of domestic capacity reduction, if cement enterprises want to build a new cement clinker production line with fixed capacity, they must shut down a production line with no less than the fixed capacity. Cement companies can also be replaced across provinces, that is, shut down production in one province and build a new production line in another province. At present, the areas affected by capacity replacement are mostly concentrated in Guangxi, Guizhou and other places, and the new supply in these areas will be reduced. Capacity replacement is considered to be the main means to revive zombie capacity.

In terms of price, the concentration of large enterprises has increased, which is conducive to the implementation of regional coordination among enterprises and the stability of cement prices. According to a research report released by Huaxi Securities on March 2, the concentration of the top ten enterprises in the cement industry has reached 56%. In East China, where the domestic cement price is the highest, the concentration of the top five enterprises in the market size reached 80%.

Affected by the resumption of infrastructure construction and the high pace of rush work, financial support began to increase. On February 11, the Ministry of Finance released news that the Ministry of Finance issued a new local government debt limit of 848 billion yuan in 2020 in advance, plus the special debt limit of 1 trillion yuan issued in advance in November 2019, a total of 1.848 trillion yuan of new local government debt limit in 2020 in advance.

China Railway construction personnel told the "China Business Daily" reporter that the Ministry of Finance's move is mainly to deal with the impact of the epidemic on the economy, and it is expected that the scale of special debt will be further expanded in 2020, and the annual scale will exceed 3 trillion yuan. He also said that this year is the last year of the 13th Five-Year Plan, and local governments will speed up the payment of funds, which is also good for enterprises. This year, the state will increase the funding support for infrastructure construction, and the funding situation of local governments will be better than last year, so the cash flow of infrastructure enterprises will maintain good growth.

In terms of the specific growth rate of investment, people from China's railway engineering infrastructure enterprises analyzed that in order to ease the downward pressure on the economy, after the epidemic is stabilized, the country may release more projects and projects, and it is expected that the growth rate of China's infrastructure investment will increase significantly compared with 2019. "Full-year growth will exceed 7 per cent and could even reach 9 per cent." 'he said.

This growth rate is not as high as the double-digit growth in infrastructure investment a few years ago, but it is well above the past two years. According to data released by the National Bureau of Statistics, from 2015 to 2019, the growth rate of China's infrastructure investment was 17.2%, 17.4%, 19.0%, 3.8% and 3.8% respectively. In 2018, the growth rate of infrastructure investment was a turning point from fast to slow, and the person in charge of the National Bureau of Statistics publicly responded that the slowdown in the growth rate of infrastructure investment was related to the standardization and clearing of PPP (government and social capital cooperation) projects and local debt financing.

Eighteen provinces have announced plans to invest 1.76 trillion yuan in transportation infrastructure in 2020, up 11.6 percent year on year, according to a research report released by West China Securities on March 2.