On the afternoon of July 27, Yin Hong, secretary-general of the Foshan Ceramics Industry Association and professor of South China University of Technology, gave a special speech on "New Trends in the Ceramic Industry Under the Huge Waves" at the "2021 China Ceramics Industry Development Conference", giving a speech on the 2021 The industry situation in the second half of the year is predicted, and hot topics such as slate development, expansion of leading companies, and channel changes are analyzed.
The following is an excerpt from the speech▸▹▸
What is the giant waves washing away the sand? In the past five years, the number of architectural ceramics companies nationwide has decreased by 317, with an exit rate of 22.5%; there are currently 2,760 production lines, a decrease of 861 lines, or 23.8%, in the past five years.
In addition to large slabs, the production capacity of polished tiles, interior wall tiles, exterior wall tiles, antique tiles and other categories is declining, and the utilization rate of natural gas is increasing. In the first half of this year, the output of ceramic tiles increased by 10.57% year-on-year, and exports decreased by 18.5% year-on-year.
01
Prediction of ceramic tile industry in the second half of the year:
YoY growth, month-on-month decline
First let’s talk about the prediction of the overall market in the second half of the year. The ceramic tile industry is closely related to the real estate industry.
The changes in real estate investment in 2020 and 2021 will be ups and downs, as will the sales area. Generally speaking, there will be year-on-year growth and month-on-month decline. That is, it has increased year-on-year, but each month has decreased compared with the previous month.
There have been two key events in real estate recently. One is that Guangfa Bank sued Evergrande and froze Evergrande's funds. The second is that the central enterprise Sino-Ocean Group acquired 70% of the equity of Chongqing Red Star Real Estate.
It is unlikely that these giants will go bankrupt, but if the real estate crisis continues, the impact on the building materials and home furnishing industry will be difficult to estimate.
So the famous economist Ma Guangyuan said that the era of real estate is not over yet, and there are several typical changes in the real estate industry:
One is that we have not left the real estate economy, the other is the formation of real estate oligarchs, and the proportion of finely decorated houses is getting higher and higher, prefabricated buildings are developing rapidly, and heavy investment has been invested in old renovation. The development of finely decorated houses means that the proportion of centralized procurement of projects will become higher and higher for the ceramic tile industry.
Based on this situation, we haveJudging from the situation in the second half of the year, the ceramic tile industry will continue the trend of real estate.
Sales in the ceramic tile industry were very hot before May, but the pressure was already felt in June and will continue in July. The overall result is year-on-year growth and month-on-month decline. Life will become increasingly difficult in the second half of the year.
02
Exports continue to decline, and the industry is "heading westward"
At its peak in 2015, our export volume was 1.138 billion square meters. By 2020, there are only 620 million square meters left, basically half. In the first half of this year, our exports continued to decline by 18.5% year-on-year in 2019, and exports are still declining.
Industrial transfer is all the way to the west. In Guangxi and Chongqing, Oceano, Mona Lisa, Jianyi, Hongyu, Xiejin, Weimei and Dongpeng are expanding. Sendai and Keda are building factories in Africa. Many companies have gone to Southeast Asia. Wangkang is mainly in the Middle East and Africa, with an annual output of 230 million square meters.
03
Stone slabs and thick bricks have reshaped the industry ecology
Tile products, everyone knows slate and thick bricks, and sometimes we bring functional tiles. In 2010, Teacher Chen Fan said: The first thirty years are spent making bricks, and the next thirty years are spent making boards. This is very forward-looking. Ten years later, this era has arrived.
In 2016, I wrote an article "Three years later, ceramic slabs below 1200×2400 will be the world of the Chinese." At that time, 10,000-ton presses appeared, and 16,800-ton presses were about to be launched.
In 2017, I wrote a column "No big board, no big name".
Then in 2019, at the Slate Summit, he said something like this: Slate is such an explosive product that is triggering changes in the basic ecology of the ceramic tile industry and creating new ecological opportunities.
201There is a popular saying in 9 years: The rock slab is a huge "pit".
Zhang Qikang of the 2020 Mona Lisa said: Slate has broken the ceiling of ceramic tile applications, and behind it is a market worth hundreds of billions.
In 2020, a friend left a message in my circle of friends: Slate is a false proposition, and the product cycle will not exceed 16 years.
At the Slate Summit in 2020, I talked about the pottery industry and the slate industry.
In 2021, I say: Rock slabs have no boundaries. Where there are applications of slabs, there will be a presence and a market for slabs.
I think this basically represents some of the industry’s views on slate, and you can see that there is a big difference.
Stone slabs are an upgraded version of ceramic tiles. As long as ceramic tiles have vitality, rock slabs will inevitably exist. The black, white and gray that have been prosperous for 10 years may change in color. Slate includes all the places and colors that ceramic tile products can be used in. So I think rock slabs are here to stay.
I saw a report that the Chengdu furniture market is divided into three parts: slate, stone, and glass. It is fast enough for slate to capture 1/3. But a dealer in Chengdu said that this was the situation last year, but it is no longer the case this year. Now in Chengdu's home building materials market, glass is basically out, with stone accounting for 20% and slate accounting for 80%.
In May, the Xiamen Stone Fair will be open to slate companies. We all know that in the past, the Xiamen Stone Fair was completely closed to marble tiles, but it is open to slate companies.
When I went to Xiamen in 2018, there were already 32 stone dealers selling slates in Shuitou Market. This year when I went to Jinjiang Home Expo and Xiamen Stone Exhibition, I would ask how many people are selling slates in Shuitou Stone Market now? They said it seemed like every house was selling.
Stone board products are subversive in the ceramic tile industry. In the past few months, people feel that there is a bit of a bottleneck. Some companies have stopped production lines and liquidated their stocks. The price has fallen below 60 yuan/㎡.
In any case, I think the current bottleneck of slate is its implementation and delivery, and the socialization and professionalization of third-party services are not in place.
We buy a 1200×2400mm rock slab. If installation is not included, the freight and installation will basically exceed the price itself. This situation will definitely blossom as the professionalization of third-party services fully blossoms, causing the application cost to completely drop, and there will be a big blowout for rock slabs, especially when it fully enters the field of customization.
Stone board is a multi-channel product. It is changing our ecology and creating new opportunities, but it has not yet fully exploded.
Will there be a surplus of slate products, a price war, or vicious competition? Does it look like a “big pit” from now on? Now look,meeting.
It used to sell for more than 100 yuan/㎡, but the OEM price may exceed 60 yuan/㎡ in the second half of this year. Although it is quite scary, there is also a saying: lower profits are not the result of business decline, on the contrary, it is the inevitable result of business prosperity. Without sufficient competition, there cannot be adequate development.
From the data released by the China Building Materials Federation and the China Stone Industry Association, even if we take all the shares of stone, we will only have 770 million square meters, which is far from our 8-10 billion square meters of ceramic tiles. Compared with the production volume, if we want to enter the stone field, how much share will we increase? The selling price of stone still remains at 401.45 yuan/㎡, indicating that there are still opportunities for rock slabs, including thick brick products.
Generally speaking, there are four major areas of slate: ceramic tiles, stone, kitchen and bathroom space and furniture panels. Others include suspended ceilings, refrigerator surface materials, yacht decks, etc. So I think rock slabs have no boundaries and can be found in almost all places where slabs are used.
Thick bricks are floor paving stones. At the Jinjiang Home Expo on April 1 this year, they basically accounted for 80%. Fujian is applying for a national-level production base for floor paving stones (thick bricks). In the future, stone will be replaced on a large scale in municipal squares and iconic squares.
04
Mergers and expansions of leading companies
Rapid progress in technical equipment
The ceramic tile industry has another move: expansion and mergers, embracing capital, large-scale and generous investment.
Weimei expanded its third phase in Fengcheng, Jiangxi; Oceano invested in the first phase in Teng County and launched the second phase, and also invested in Shanxi Huizi New Materials; Dongpeng expanded its Fengcheng base and also acquired Shanxi Jinshijia Ceramics ; Mona Lisa acquired 70% of Putin's equity, Hongyu acquired 2,600 acres of land in Teng County, and also acquired Xinzhong Tao; Nobel built 12 new lines, 8 in Fanchang, Anhui, and 4 in Jiujiang, Jiangxi; Da Jiaolu acquired and built a factory in Yunfu... This expansion momentum is very strong.
At a time when the real estate bubble seems to be bursting but not bursting, I think it is better to be cautious.
ArchitectureAdvances in ceramic technology. The most important thing in today's exhibition (Guangzhou Ceramics Industry Exhibition) is dry powdering and continuous ball milling. I saw a continuous ball mill in Dongpeng. It only takes one hour from the raw materials coming in to the slurry coming out, which is very efficient.
At the exhibition, everyone can see technological advancements such as large-tonnage presses, digital, intelligent, and precise cloth technology, digital glaze, digital molds, electrostatic glazing, wide-body kilns, and intelligent warehousing. We are now in an era of energy conservation, emission reduction, and dual-carbon economy, so many of these new technologies focus on reducing carbon emissions.
05
The new marketing landscape:
Engineering, decoration, and retail are divided into three parts of the world
The new pattern of our ceramic tile marketing used to be 80% of the dealer system. Now, because there are more finely decorated houses, the centralized procurement of larger projects, decoration and retail are divided into three parts.
In the 2018 Diou annual report, Oceano’s sales that year were about 3.8 billion yuan. Its largest customer, Country Garden, exceeded 2 billion yuan, more than 50%, and its receivables were more than one billion yuan. This is not Ordinary enterprises can afford it, and there is no need to talk about it without capital.
Construction, let me show you the annual reports of three decoration companies. Golden Mantis' annual revenue is 31.1 billion yuan, and the largest ceramic company's revenue is only 10 billion yuan; Yaxia Co., Ltd., a major home decoration company, has annual revenue of more than 10 billion yuan; Dongyi Risheng has more than 3 billion yuan.
There is also Hangzhou Shengdu Decoration, which has a maximum annual revenue of more than 4 billion, and was acquired by Beike for 8 billion. Renovation has become an important entrance to the connection between the ceramic tile industry and real estate.
The sales volume of retail stores dropped by 24.19% in 2020, but the data released in the first half of this year saw a significant increase in sales. The annual reports of Red Star Macalline, Easyhome, and Fusenmei all declined significantly in 2020. Easyhome increased by more than 100% in the first half of the year, and Fusenmei was relatively stable, with an increase of 38%.
So many people say that regional dealers have no future and can be replaced. This is not entirely true. Where is our way out now? No matter which industry we are in, we must embrace the Internet and adopt new retail. It is still necessary to sink channels in the rural market.
Now dealers can develop horizontally through multiple channels, especially integrating multiple categories, making auxiliary materials, and rationally utilizing space. Vertical development, pre-sales service + after-sales service, everyone pays special attention to Jian Yi, who delivers finished products. To make ceramic brands bigger and stronger, regional dealers mustTransform into a brand service provider.
Finally, with regard to energy consumption limits, carbon peaking, and carbon neutrality, we now need to develop new products and energy-saving kilns. Many newly built factories are now using photovoltaic power generation.
This is the best of times and the worst of times. We will find that there are "pits" everywhere, with fewer and fewer opportunities, more and more costs, more and more crises, and greater risks... But if we think of a good way, we can turn around and everything is available.
(Article reproduced from Ceramic Information)
