After Hengyi Group acquired Longteng Chemical Fiber at the end of last year, it made another move to acquire Red Sword in March this year; Tongkun Group invested a massive 3.508 billion and started the construction of two differentiated fiber projects at the same time. A few days ago, Xinfengming Group officially landed in the capital market…
In recent years, the polyester market has been experiencing constant “big news”, and coincidentally, the protagonists of these “big news” events are all leading chemical fiber companies from Zhejiang, and they have all been successfully listed.
But what the editor wants to mention today is another Zhejiang company that is “quietly making efforts” – Tiansheng Chemical Fiber. Although it is not as early as the “PTA duo” Rongsheng and Hengyi, judging from Tiansheng Chemical Fiber’s recent actions, its strength and stamina should not be underestimated!
Event 1: Recently, Zhejiang Tiansheng Holding Group Co., Ltd.’s Tiansheng Chemical Fiber Phase II 500,000-ton differentiated fiber project entered the equipment installation and commissioning stage. It is understood that the project adopts fully automated production with a total investment of 2 billion yuan. It is expected to open 6 production lines by the end of April. After the project is completed, the group will have an annual production capacity of 900,000 tons of differentiated fiber and is expected to achieve sales revenue of 8 billion yuan. Yuan.
Event 2: On April 18, Southern Petrochemical was auctioned off on the Taobao judicial auction platform for nearly 700 million yuan. According to industry insiders, the bidder behind the bid is Tiansheng Group.
Whether it is acquiring bankrupt production capacity or expanding new production capacity, the strength and courage of a company can be seen behind it. Tiansheng Chemical Fiber’s “advance on both legs” this time clearly reveals its determination to not be left behind in the fierce industry competition and to strive for the top. After all, those who fall behind will face elimination. This is the cruelty of the accelerated reshuffle of the chemical fiber industry after entering the “Warring States Era”.
Industry prosperity has rebounded, attracting chemical fiber giants to join forces
However, at this stage, the chemical fiber giants have been making frequent efforts. It is not just a competition for production capacity. In order to gain a foothold in the first echelon of the industry, we should also see that the rebound in the market situation is attractive to chemical fiber manufacturers. , so that they have the confidence and confidence to dare to take action when others stop.
“The fragrance of flowers attracts butterflies.” The prosperity of the domestic polyester filament industry has gradually declined since the fourth quarter of 2011, and the entire industry has entered a period of deep structural adjustment, reaching the bottom in 2013, and has been hovering at a low level since then. At this stage, many companies were dragged down by the downturn and finally collapsed.
According to incomplete statistics, 12 chemical fiber companies have been affected by the “shuffle” since 2012
However, after capacity clearing and structural adjustments, as downstream demand gradually recovered, the polyester filament industry’s prosperity rebounded significantly in 2016. From the current point of view, the new production capacity of the industry in the future is relatively limited. The new production capacity in 2017 is expected to be 1.55 million tons, mainly from a few leading companies with strong strength.
In terms of demand, my country’s textile and apparel sales have maintained a growth rate of more than 5% in recent years. Coupled with the boosting effect of RMB depreciation on exports, it is expected to drive steady growth in demand for chemical fibers. In the future, demand in my country’s chemical fiber and polyester fields is expected to maintain a growth rate of around 6%-8%.
As the industry’s new production capacity slows down, the supply and demand situation in the polyester industry is expected to continue to improve, and there is still room for improvement in the industry’s economic recovery. Especially since this year, due to the sufficient supply of PTA, and both Far East Petrochemical and Xianglu Petrochemical have the intention to restart, negative expectations of oversupply in the later period have suppressed the market, and the weak performance of the raw material end has created considerable profit margins for downstream polyester. At the same time, with the support of demand, chemical fiber manufacturers are expected to continue to maintain high production profits.
Spring River Plumbing Duck Prophet. The polyester industry has finally “entered spring” after experiencing labor pains. It is natural for chemical fiber bosses to show their ambitions to expand production capacity under optimistic expectations for the future.
From simply “winning by quantity” to differentiated competition
However, chemical fiber companies must also clearly realize that the scale of production capacity does represent the strength of the company to a certain extent. However, there is structural excess capacity in the polyester consumer yarn industry. The previous type of economies of scale that relied on “win by volume” Times have passed. Once you get into a project, it doesn’t necessarily mean there will be a market, you still have to worry about sales.
Therefore, when homogeneity and price wars increasingly test the profitability of enterprises, the research and development of differentiated and high-quality products has become the only way for enterprises to transform and upgrade. While maintaining the advantage of scale, how to use high-end and high-quality differentiated products to attract downstream users, maintain and expand market share, is the next step for companies to consider.
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