2023, the year of hope for the glass industry

2023, the year of hope for the glass industry

In 2022, the glass market will fluctuate in a wide range and run weakly. Near the end of the year, the industry still faced the unfavorable situation of high inventory, weak demand, and weak expectations. Recently, the glass futures and spot market has begun to stabilize, and it has gradually become clear that the supply and demand of glass is improving.

The constraints on the glass supply end are expected to be further strengthened. As an economist pointed out, deepening supply-side structural reforms must focus on improving the quality and efficiency of the supply system, improving the adaptability of the supply structure to effective demand, and not forming a situation that does not conform to the direction of development and market demand. Outdated production capacity and products cause waste of social resources and wealth.

The "Building Materials Industry Carbon Peak Implementation Plan" issued on November 8, 2022, in accordance with the overall national deployment, combined with the actual situation of the building materials industry, proposed that the building materials industry achieve carbon peaking by 2030, and encourage qualified industries to reach the peak first. At the same time, the main goals of the two stages of the "14th Five-Year Plan" and "15th Five-Year Plan" were proposed. During the "14th Five-Year Plan" period, the unit energy consumption and carbon emission intensity of key products such as cement, glass, and ceramics continued to decline, and the comprehensive energy consumption per unit product of cement clinker decreased by more than 3%. During the "15th Five-Year Plan" period, major breakthroughs have been achieved in the industrialization of key green and low-carbon technologies in the building materials industry, the level of substitution of raw materials and fuels has been greatly improved, and an industrial system for green and low-carbon circular development has been basically established. The "Implementation Plan" proposes a series of energy-saving and carbon-reducing measures, including giving full play to the comprehensive role of policies, standards and markets, guiding the exit of inefficient production capacity; accelerating the application of clean and green energy, increasing the proportion of natural gas and electricity in an orderly manner, and promoting the focus of air pollution prevention and control The region will gradually reduce until the cancellation of coal-fired heating, drying furnaces (kilns), and fuel gas generators in the building materials industry; accelerate the promotion of energy-saving and carbon-reducing technology and equipment.

From this we can know that the future of the glass industry lies in capacity optimization and technological innovation. These measures will significantly improve the situation of low-level competition in the glass industry under the situation of excess supply while effectively promoting energy conservation and carbon reduction in the flat glass industry.

Glass demand expectations tend to be optimistic. In the fourth quarter of 2022, relevant policy documents in the real estate field will be issued intensively. The "Notice on Doing a Good Job in the Current Financial Support for the Steady and Healthy Development of the Real Estate Market" and "The Notice on Work Relevant to Issuing Letters of Guarantee by Commercial Banks to Replace Pre-sale Supervision Funds" and other related work have played a key role in maintaining the stability and order of real estate financing and actively doing a good job in "guaranteed building" finance. Careful arrangements have been made to provide services and promote the healthy development of the real estate industry. The "three arrows" of credit, bonds, and equity financing in the real estate sector have been shot out one after another, and the pessimistic expectations of the real estate market are expected to be reversed. Under the high turnover mode of real estate enterprises in the early stage, the sales area of domestic off-plan housing once exceeded 80%. From the logical relationship between the start of construction and the completion of construction, it can be inferred that there is a large amount of real demand for real estate completion to be released. The guaranteed quality and on-schedule delivery of sold commercial housing is the key to boosting the confidence of home buyers. With the implementation of relevant policies and effective implementation, the release of demand for real estate completion will become the focus of the glass industry in 2023.

The supply and demand of glass is expected to continue to improve, but the high inventory situation in the off-season of consumption has a certain continuation. In the past few weeks, the far-month futures contract has been operating strongly, and the near-month contract has remained volatile. In mid-December, the futures and far-month contracts continued to rise, and the monthly price difference widened. The internal power to repair the monthly difference pushed up the near-month contracts. Let's go up together.

The rise in glass prices is in line with market expectations, and 2023 will be a year of hope for the glass industry. P.S. The article comes from China Glass Network(www.glass.com.cn)

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