Machinery / Industrial Parts & Tools

1. Construction machinery has entered the second peak season of the year, but it is not as good as the same period in previous years

According to statistics from 25 excavator manufacturers by the China Construction Machinery Industry Association, 20085 excavators of various types were sold in September 2021, a year-on-year decrease of 22.9%; of which 13,934 units were domestic, a year-on-year decrease of 38.3%; 6151 units were exported, a year-on-year increase of 79% .

From January to September 2021, a total of 279,338 excavators were sold, a year-on-year increase of 18.1%; of which, 232,312 were domestic, a year-on-year increase of 9.16%; 47,026 were exported, a year-on-year increase of 98.5%.

It can be seen from the chart that in September, excavator sales continued to grow negatively year-on-year, but rose 11% month-on-month, and the increase was mainly from foreign orders. In September 2021, China's construction machinery market index (CMI) was 116.83, a year-on-year decrease of 13.87% and a month-on-month increase of 8.62%, indicating that the domestic construction machinery market began to enter the second peak season of the year in September. But overall, the index is lower than the expansion value, and the second peak season of 2021 is expected to be worse than the same period in 2020 and 2019.

2. Domestic sales continue to decline, and the domestic peak season is not prosperous

"Golden Nine and Silver Ten" is often referred to as the peak season for construction and infrastructure, but since the beginning of this year, real estate companies have limited the return of funds, resulting in the continuous decline of new construction and construction area in the third quarter, insufficient funds and high raw material prices, and the low rate of construction projects ( In September, it was 77.9%, which was only 1% higher than that in August). The utilization rate of concrete production capacity was significantly lower than that of the same period last year. Domestic demand recovered slowly and superimposed on the high base of last year. Domestic sales of construction machinery continued to decline year-on-year.

3. Strong exports, mainly from Russia, Indonesia, and the United States

From January to August, China’s export of construction machinery was 35.291 billion yuan, an increase of 76.23% year-on-year. In terms of exporting countries, Russia, Indonesia, Belgium, and the United States were China’s main exporting countries. Among them, Russia accounted for 9.12%, Indonesia, Belgium, and the United States. They accounted for 8.95%, 6.85% and 5.18% respectively, followed by the Philippines, Thailand, Germany, Australia and other countries.

In terms of loaders, 9,601 loaders of various types were sold in September 2021, a year-on-year decrease of 16.1%. Among them: 8,753 loaders of 3 tons and above were sold, a year-on-year decrease of 17.6%. The total sales volume in the domestic market was 6,729 units, a year-on-year decrease of 25.6%; the export sales volume was 2,872 units, a year-on-year increase of 19.6%.

From January to September 2021, a total of 112,401 loaders of various types were sold, a year-on-year increase of 14.2%. Among them: 103,277 loaders of 3 tons and above were sold, a year-on-year increase of 11.6%. The total sales volume in the domestic market was 86,449 units, a year-on-year increase of 6.35%; the export sales volume was 25,952 units, a year-on-year increase of 51.2%.

4. Construction machinery exports improved in October, but domestic sales fell short of expectations and may continue to be negative year-on-year

1. The north enters winter ahead of schedule, and the downstream demand is less than expected

Affected by the cold air in the north, after the National Day, the temperature in various places has obviously begun to drop. This year, the cold winter has arrived earlier, affecting construction in some areas. Judging from the current volume of building materials, the volume in the second week of October fell precipitously, and the market demand was not optimistic. The downstream construction was mostly postponed due to the high price of building materials. The second peak season of construction machinery may also be "cold" in the second peak season of the year. There is limited room for growth in demand.

2. The electricity curtailment in various places has not been loosened, affecting the normal production of equipment

Since the end of September, the dual control of energy consumption has become stricter. Although entering mid-October, there are signs of relaxation of production restrictions in some areas, but from the supply side, the tight coal supply situation has not been effectively alleviated, but power plant inventories have accelerated. The heating season is about to enter, and the keynote is still to protect people's livelihood. Industrial power will continue to be affected, and power rationing may affect the production of the construction machinery industry chain.

3. The export continued to improve, which provided certain support for the sales of construction machinery. The export volume of excavators in September hit a new monthly high, mainly driven by the economic recovery after the epidemic in the international market. North America and countries along the route have continuously increased investment in infrastructure construction, and there is a strong demand for construction machinery in the international market. At the same time, China’s newly signed overseas contracted projects in the fields of transportation, power engineering and other factors have driven the demand side. From January to August, Chinese companies signed 3266 new foreign contracted engineering project contracts in 60 countries along the route, and new contracts were signed. The amount was 458.86 billion yuan, accounting for 51% of the newly signed contract value of China's foreign contracted projects in the same period. On the whole, the export sales volume of excavators has reached 36% in the past five years. Since the beginning of this year, exports have doubled and the proportion of exports has reached 16.83%. It is expected that exports may become an important growth point for China's construction machinery in the future.