Building Materials Glass Industry Research Weekly

The average price of white glass for construction in the country this weekend was 1,536 yuan, up 7 yuan from last week and up -91 yuan from last year. This week, the overall trend of the glass spot market has risen steadily. The production and sales of production enterprises have increased slightly, and the market prices in some regions have adjusted. The market sentiment has improved. Overall, the orders of downstream processing enterprises are relatively stable, and some regions have increased in the chain. With the advent of the traditional sales season, traders have also increased their stocks in moderation. Although some areas were affected by the rain and the manufacturers were blocked, the overall inventory of the manufacturers still showed a slight decline, which eased the financial pressure of the manufacturers. In terms of production capacity, this week, the 600-ton cold repair of the second line of Qizhou Qibin was completed, and the ignition was resumed. It is expected that the board will be led by the end of the month to produce high-quality glass. It is expected that some production lines in southern China will be re-launched in mid-term.

From January to June 2019, the glass output increased by 6.8% year-on-year. We believe that the statistics released by the Bureau of Statistics may be slightly distorted due to the statistical caliber. According to the capacity data published by China Glass Futures Network, we believe that the actual production growth rate should be 3 -4%. From the perspective of the number of production lines, due to the sharpening of Shahe environmental protection at the end of 2017, a large number of production lines entered the cold repair, resulting in only 222-227 production lines from January to June 2018, and from January to June 2019. The number of production lines was 230-234, and the production capacity increased year-on-year.

The status quo of real estate “high-end housing sales + low inventory” provides support for glass demand. In recent years, there has been a clear deviation from the high growth rate and the completion rate of real estate sales and new construction. In recent years, the real estate sales have increased significantly in the proportion of medium-term housing, which has accumulated more pressure for completion delivery, although it is late. After all, there will be a subsidy, and the possibility of a gradual mean return in the second half of 2019 is higher. Since the main application scene of glass is completed before construction, if the construction link is warmed up overall, the demand for glass will have certain support. In the macro data of the past three months, the growth rate of the construction end has begun to pick up, and the demand for glass in the second half of the year has warmed up. The logical support is gradually verified. From the construction data, the growth rate was 8.8% from January to June, and the growth rate was the same as that in January-May. The high construction growth rate will be gradually transmitted to the glass installation, and the glass demand is tough.