
Displaying items by tag: NDRC
Three Chinese cement companies fined US$18.6m for price monopoly
09 September 2014China: The NDRC, China's price regulator, has fined three Chinese cement companies a combined amount of US$18.6m for engaging in a price monopoly. The three companies are Jilin Yatai Cement Sales Co, Northern Cement Co and Jidong Cement Jilin Co.
Guangdong carbon market to launch in December 2013
27 November 2013China: Guangdong Province plans to launch carbon emission trading in December 2013. It will be the world's biggest carbon trading scheme after the European Union.
Guangdong has started allotting 388Mt of carbon emission quotas to selected enterprises, according to the provincial development and reform commission. Initially 242 companies from cement, power, iron and steel and petrochemical industries have been included in the quota allocation. The scheme will cap CO2 emissions at 350Mt for 2013.
Quotas equivalent to 29Mt of carbon emissions will be auctioned and the base price will be US$9.8/t. The rest of the quotas will be allotted to companies for free.
Shenzhen City started its carbon trading market in June 2013 and Shanghai launched its market on 26 November 2013. The National Development and Reform Commission has also approved pilot carbon emission trading schemes in Beijing, Tianjin, Chongqing and Hubei. China has pledged to reduce CO2 emissions by 40 – 45% per unit of GDP by 2020.
China prepares to cut cement capacity as output rises by 9.7% to 1.1Bt in first half of 2013
31 July 2013China: China produced 1.1Bt in the first half of 2013, a year-on-year increase of 9.7%, according to the latest statistics released by the National Development and Reform Commission (NDRC). The cement inventory of the country's major cement producers increased by 0.3% year-on-year to 27.76Mt. Profit for the cement industry remained flat with a 1% increase year-on-year to US$2.49bn.
Meanwhile the government is considering a detailed plan to eliminate outdated industrial production capacity, according to the China Securities Journal. The plan is expected to eliminate outdated capacity in the cement, steel, electrolytic aluminum, plate glass and shipbuilding sectors.
Zhu Hongren, chief engineer of the Ministry of Industry and Information Technology (MIIT), confirmed that MIIT and the NDRC are currently working on the plan. The plan will boost the sectors' utilisation of existing capacity by setting industry access standards and eliminating outdated capacity. To ease overcapacity in affected industries, MIIT ordered in late July 2013 around 1400 companies in 19 sectors to eliminate outdated production capacity by September 2013 and eliminate excess capacity by the end of 2013.
China cement news in brief
29 May 2013National: China's cement output grew by 8.7% year-on-year in April 2013, rising from a 4% increase in the same month of last year, according to the latest statistics released by the National Development and Reform Commission (NDRC). In the first four months of 2013, the country's total cement output reached 641Mt, an increase of 8.4% year-on-year from the same period in 2012. Profits for the cement industry fell by 29.4% for the first quarter of 2013 to US$606m.
Regional: In southwest China, Chongqing Municipality produced 17.7Mt of cement over the first four months of 2013, a year-on-year increase of 11.2%, according to the local statistics bureau. Yunnan Province produced 28.4Mt of cement in the first four months of 2013, a year-on-year increase of 27.8%.
The central Hubei Province saw cement output slide by 2.6% year-on-year to 31Mt for the first four months of 2013. Hunan Province saw its cement output rise by 8.3% year-on-year to 9.33Mt in April 2013.
Eastern China's Jiangsu Province saw cement output grow by 15.1% year-on-year to 55.5Mt for the first four months of 2013.
Government: China has confirmed that it intends to release a blueprint for urbanisation in 2013, the state-run Xinhua News Agency has reported, citing officials with China's top economic planner. Officials with the NDRC said the urbanisation development plan is 'very important' and that the NDRC was leading the drafting. Shares in cement suppliers and other construction-related companies have already benefited from expectations of more housing and infrastructure projects.
Corporate: Chinares Cement has announced it is in discussion with Fujian Cement about setting up a joint-venture to build cement grinding lines, and to coordinate marketing and sales. No agreement has been reached yet.
Same old story: cement overcapacity in China
07 November 2012Liu Ming of the National Development and Reform Commission (NDRC) once again stated the obvious this week: China is producing too much cement.
He made the same warning on overcapacity that has been made all year. Officials from the NDRC have recommended stricter controls on new capacity, faster mergers and acquisitions, elimination of out-dated capacity and faster industry upgrades. Unsurprisingly this is exactly the line that China's Ministry of Industry and Information Technology (MIIT) was hawking in its 12th Five-year Plan (2011-2015) for the country's building materials industry that it released back in 2011.
So what's actually happened since last time Liu Ming played Cassandra?
Back in July 2012, at the time of the half-year financial reports, it looked like Chinese cement producers were facing profit gaps of around 50%. Now it looks worse. Major producer China National Building Material Co (CNBM) has reported a drop in net profit of 40% to US$575m for the nine months to 30 September 2012. Anhui Conch has reported a drop in net profit of 57% to US$632m. China National Materials Co Ltd (Sinoma) has reported a 76% drop in net profit to US$48.8m for the same period. Jidong Cement reported a 83% drop in net profit to US$38.6m.
In 2010 Chinese cement production was 1.87Bt. In 2011 it was 2.06Bt, according to Chinese state-released statistics. From January to September 2012, the country produced 1.59Bt of cement, a year-on-year increase of 6.7%. For the full year of 2012 it is estimated that China will produce 2.8Bt/yr. However, according to the NDRC production growth have fallen to 6.7% in 2012 compared to 11.4% in 2011. Capacity is still rising whilst profits are plummeting.
At the start of 2012 the Chinese Vice Minister of Environment Protection, Zhang Lijun, announced that the ministry plans to introduce stricter rules on NOx emissions from cement plants. At the time it was reckoned that the move could wipe out a third of the industry's total net profits. Then in September 2012, industry reports suggested that the government was now going to set nitrogen oxide emissions to 300mg/m3, below the international standard of 400mg/m3. It was estimated that only about a third of producers would be able to afford the necessary upgraded equipment to meet the requirement. Then, also in September 2012, the Guangdong Emissions Trading Scheme (GETS) was launched, which might offer another way of restraining production.
In summary: profits are tumbling, production is probably slowing and new controls are as-yet unbinding. Yet, perhaps Liu Ming repeated his warning for one particular audience who can make a difference. On 8 November 2012 the Chinese Communist Party holds its 18th national congress to decide the new leadership. Producers like West China Cement are certainly hoping this shakes things up. It recently announced that it was waiting for new infrastructure projects to be approved to swallow up its growing surplus.
China's cement industry faces vast overcapacity say NDRC official
01 November 2012China: China's cement industry is facing massive overcapacity despite a recovery in output in September 2012, said Liu Ming, an official of the National Development and Reform Commission (NDRC).
By the end of 2011, a total of 1513 cement works were operating in the country, with a total cement output of 2.3Bt. According to Liu, 210 new cement works are either under construction or to be opened. Once they are all in operation, the nationwide cement output is expected to reach 2.8Bt/yr.
The official said that China would strictly control new production capacities, raise the thresholds for access to the industry, promote mergers and acquisitions in the industry, and eliminate outdated production capacities.
In the first nine months, China's total cement output reached 1.591Bt, an increase of 6.7% year on year. In September 2012 alone, the monthly output hit a record high of 210Mt, reflecting a recovery in the industry.