Total trade deficit Spendex Satin Manufacturers
The latest performance of China's machinery and equipment manufacturing industry trend showing a boom, but generally traditional products is already very fierce competition in future, have greater investment value of companies should be those with high technological content and high added value manufacturers.
Recently, the National Development and Reform Commission Economic Operation Bureau released its latest report on machinery and equipment manufacturing industry. The report shows that in 2006 the first 10 months, the industry's main business income of 4.27 trillion yuan, an increase of 30.2%, an increase of 9.2 percentage point increase; total profits of 230 billion yuan, an increase of 41.7% over the same period increased 39.6 percentage points . The report concluded that China's machinery industry in 2007 there is still ample room for development.
Export Growth Than Import
Development and Reform Commission Economic Operations Bureau report shows the first 11 months of 2006, China's machinery industry total industrial output value 5 trillion yuan, up 29.4%, an increase of an increase of 8.2 percentage points; the completion of the industrial added value RMB1.26 trillion yuan, growth 21.3%, increased by 7 percentage points; cumulative production and marketing rate of 97.29%.
Among the 95 types of industry the main products, three quarters of the products achieved double digit growth. Produced 6.66 million vehicles, up 26.1%, of which 3.56 million cars, an increase of 40.3%; power generation equipment 109.23 million kilowatts, an increase of 30.8%; metal cutting machine tool 510,000 sets, an increase of 13.9%, numerical control machine tool 77000 units, an increase of 30.8% ; oil refining, petrochemical special equipment 34 million tons, up 59.9%.
In addition, the export growth is higher than imports, trade deficit gradually narrowed. In 2006 the first 10 months, mechanical industrial exports 115.8 billion U.S. dollars, up 36.8%; imports of 115.9 billion U.S. dollars, an increase of 21%; total trade deficit Spendex Satin Manufacturers of only 1.3 billion U.S. dollars, over the same period of 2005 to reduce 11 billion U.S. dollars, imports and exports basically balanced.
By a Large Space with High Technological Content
As the state's policy to revitalize the equipment manufacturing industry step by step, and equipment manufacturing industry to be focused support. However, as China's equipment manufacturing industry in a number of areas where technical level is not high, a number of major construction projects and equipment will still have to rely on foreign imports, thereby accelerating technological innovation and equipment manufacturing industry made an urgent requirement to upgrade the structure.
Therefore, the NDRC report pointed out that with the increasing market demand, the equipment manufacturing industry in 2007 to obtain a more generous space for development, but the "structural surplus" of supply and demand relationship will exist in the longer term. The near future, although some general growth in demand for traditional products, but the competition is very intense; high technological content and high added value of major technical equipment demand will grow rapidly.
CITIC Securities analysts believe that China's future a large number of foreign engineering contracting and to enhance their competitive edge will promote the export of domestically produced equipment, high growth, domestic exports of equipment not only increases an export earnings, more importantly, the release of some domestic capacity to supply and demand more balance, the industry cyclical fluctuations tend to weaken; In addition, the national economy and technological upgrading of industrial machinery and equipment industry will be 5 to 10 years to bring the golden period of development. Orient Securities Analysis Report also believes that new projects will provide engineering machinery industry of high growth, import substitution of space to open opportunities for the highly sophisticated CNC machine tools, railway equipment, the stimulation of investment will also provide opportunities for development.
Frustrated Raw Material Prices
At present, the machinery industry investment in fast growth, excess capacity gradually surfacing. 2006 1 November, general equipment manufacturing industry, electrical machinery and equipment manufacturing industry, special equipment manufacturing industry, instrumentation, and cultural and office machinery manufacturing fixed asset investment rose 55.6%, 52.2%, 40.6% and 35.1%. Moreover, as the machinery industry intensified market competition, corporate profit margins narrow, multi industry sales are generally lower than the level of revenue growth.
Development and Reform Commission in 2007 development of the industry's analysis indicates that excess capacity, industry structure adjustment will be part of the market demand for machinery products have a certain impact; particularly in the upstream energy and raw material prices and rising transportation costs will directly affect the mechanical industry economic benefits, such as copper, aluminum, high quality specialty steels and other raw material costs to run the enterprise. In addition, international trade protectionism, the macro control so that both fixed asset investment growth will slow down the development of machine building industry has brought a certain extent.
