The domestic sales volume of excavators in June is expected to be about 10000 sets
Through grassroots investigation and market research, CME estimates that the sales volume of excavators (including exports) will be about 18000 in June 2022, with a year-on-year growth rate of about -22%, and the decline will be slightly improved compared with the previous month.
By market:
The estimated sales volume in the domestic market was 10000 sets, with a growth rate of about -41%, and the decline was slightly improved compared with the previous month;
The estimated sales volume of the export market is 8000 sets, with a growth rate of about 30%, which is lower than that of the previous month.
As a typical investment dependent and cyclical industry, China's mining machinery industry is facing many uncertainties, such as market cyclical adjustment, epidemic impact, intensified competition, rising prices of raw materials and bulk commodities, emission upgrading, and complex international trade relations.
Multiple factors affect China's mining machinery industry
The pressure on the high base has eased, and the decline has narrowed, which is in line with expectations
CME observation in May, 2022 pointed out that the decline in sales growth in the domestic market has narrowed. One of the important factors affecting the decline in sales is the decline in the base after May, 2021; The narrower growth rate of the export market is also related to the high base of the export market since March 2021. The absolute sales volume of the export market is stable at around 8000 sets.
Affected by the narrowing of the decline in the domestic market and the positive growth of the export market, the decline in the total sales volume of China's mining machinery industry has further narrowed since May 2022.
High inflation and further expansion of business pressure
At present, the conflict between Russia and Ukraine has led to the rise of commodity prices, the continuous rise of diesel prices and the rise of commodity prices. The profit margin of the project has been further squeezed, and the construction progress is slow, which has restrained the demand for excavators to a certain extent. The high risk of global inflation, the rising price of bulk commodities represented by crude oil and the substantial increase in overseas freight will continue to affect China's excavator industry for a period of time.
China's excavator industry is in a downward channel
Affected by multiple factors such as macro-economy, over compensation rebound in the post epidemic era, the sales volume of excavators in China increased by nearly 40% in 2020, and reached a new record in 2021. It is inevitable that the market will adjust after the cycle reaches its peak. The weak downstream demand is reflected in the sales volume of Chinese excavators in 2021. In the downward channel, the sales volume of China's excavator market may decline for some time.
The general tone of "low in front and high in rear" remains unchanged
From March to April, the two national standing committee meetings successively emphasized that "steady growth should be put in a more prominent position". Recently, the real estate regulation in some cities has been relaxed, and the national development and Reform Commission also required to ensure that 102 major projects in the "fourteenth five year plan" are effective.
On may24,2022, the national Standing Committee called for the deployment of a package of measures to stabilize the economy and stabilize the economic fundamentals.
According to the latest data of the Ministry of finance, as of May 24, local governments had issued a total of 1.7 trillion yuan of new local government special bonds, an increase of 1.3 trillion yuan year-on-year. The issuance speed of follow-up special bonds will continue to increase. With the gradual availability of funds, more infrastructure projects will accelerate the construction. In addition, the real estate market is also gradually relaxing. Recently, provinces and cities have successively reduced the proportion of down payment, loan interest rates, and cancelled the purchase and sale restrictions to boost housing consumption, which will also drive the resumption of work and production of real estate and the promotion of new projects.
With the implementation of the steady growth policy and the gradual commencement of projects, the overall trend of "low before high" in China's mining machinery industry has become more and more obvious.
Although the national expectation of steady growth is gradually increasing, the domestic market sales of China's mining machinery are still not optimistic.
However, the underlying logic trend of "low before high" remained unchanged throughout the year. However, the future "high" level is still unknown. Small C believes that it largely depends on the availability of national project funds.
