Since the beginning of the year, coating industry has suffered many twists and turns. Due to the rich diversity of coatings, different kinds of coatings and raw materials are facing different difficulties and opportunities. However, after the major test, the iron oxide industry is still full of strong vitality and is gradually coming out of the haze.
Seeking survival in double-sided attack
As a big iron oxide exporter, China's annual export volume exceeds 300000 tons, accounting for more than 40% of the global consumption. Among them, the United States accounts for nearly 30% of the total export volume, with an annual export volume of 100000 tons. It is the largest exporter of iron oxide pigments in China. Therefore, the impact of Sino US trade war on China's iron oxide industry is huge.
Iron oxide
Since the trade war, the growth rate of domestic infrastructure investment has fallen, which has brought economic downward impact on the downstream market. Due to the additional tariff imposed by the United States on China's exports, the export to the United States was blocked, and the position of China's major trading partners also changed, resulting in a decline in the impact of domestic product sales, and iron oxide production enterprises were affected to some extent. In order to enter the international market, the export price of domestic enterprises is lower than the domestic market price, which weakens the international competitiveness of China's export of iron oxide.
The impact of the epidemic on the iron oxide industry is more direct. Shut down production, so that the iron oxide industry's monthly production capacity of at least 50000 tons. The rise of raw material prices, energy costs and labor costs forces enterprises to bear more costs, which greatly hinders the daily operation and product development of enterprises and further weakens the competitiveness of China's iron oxide in the global market.
Lin Zhihua, Secretary General of the iron oxide industry branch of China Coating Industry Association, pointed out that this year, there may be a second year-on-year decline in iron oxide production after the 2008 financial crisis.
△ Lin Zhihua, Secretary General of iron oxide branch of China Coating Industry Association
Chen Tao, sales director of Jiangsu Yuxing Group Co., Ltd., said that the biggest difficulty at present is that the epidemic makes the expired contracts unable to be performed normally, which affects the virtuous circle of the whole industry, especially the adverse consequences such as the loss of customers and the rupture of the capital chain.
Basically good after the epidemic
However, with the gradual control of the epidemic situation, iron oxide enterprises returned to work in good condition, and the utilization rate of production capacity has been restored to more than 75%. The employment rate of employees has reached 70%, and the order of production and operation has returned to normal.
Lin Zhihua analyzed in the interview that after the outbreak, the terminal demand will be launched in a centralized manner, which will bring support to the iron oxide Market. With the resumption of work and production of enterprises around the city, the supply of raw materials and logistics and transportation have been greatly eased, and production-oriented enterprises can basically be guaranteed. From the second quarter of this year, market transactions will also tend to be normal, and orders will recover and grow significantly.
In addition, Chen Tao also pointed out that after the outbreak, the internal competition in the iron oxide industry will intensify in the short term, and even the pattern of vicious competition may appear. Iron oxide enterprises should do well in environmental protection and safety, scientific and technological innovation, and meet challenges with full preparation.
△ Chen, sales director of Jiangsu Yuxing Group Co., Ltd
In the long run, the demand for iron oxide in China is gradually increasing in the international market. Even in the United States, the consumption of iron oxide will rise steadily in the future, which is still a potential opportunity for iron oxide enterprises. China's iron oxide has obvious competitive advantage in price. If a breakthrough is made in technology, its position in international trade will remain unshakable.
Recently, some iron oxide export enterprises applied to the Ministry of Finance and the State Administration of Taxation to restore the export tax rebate rate of 13% for iron oxide commodities, so as to ensure that the enterprises can safely pass the current dangerous period. In the future, the state is likely to issue corresponding supporting policies to provide protection for the iron oxide industry.
Returning to the industry itself, the iron oxide industry is closely related to the national economy, and the downstream has the stable support just needed in the four application fields of building materials, coatings, plastics and rubber. For the later market, most enterprises expressed full confidence. From the perspective of national macroeconomic and global economic trends, the fundamentals were good. With the implementation of various favorable policies and various new opportunities brought by the improvement of social life quality, China's iron oxide industry will usher in a good recovery period and realize the great counter attack of bottoming rebound.
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Supervisor: Zhang Xu editor in chief: Zheng juyu
Checked by: Zhu Zixin
Editor: Guo JIAYE
Photo source: Internet
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