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□ Market Analysis □ -----------《Times Guide 》 Plastic Machinery: A Rising Industry in China According to the 13-year statistics and analysis on the Chinese plastic machinery market by the Plastic Machinery Information Network and Dalian Plastic Machinery Research Institute, the plastic machinery industry, as a rising industry in China, will produce great efforts on each fields of national economy following the coming of the 21st century. The plastic machinery enterprises in China should fight against time to perfect its product structure, accelerate product structure adjusting pace, avoid slaughtering each other, and jointly meet the challenges in the new century. In the times of planning economy, the plastic machinery industry in China featured that the plastic machinery factories were mainly distributed in the machinery department system while plastic product factories were mainly distributed in the light industry department system. With the reform of the state economical system going further, the machinery industry, as equipment industry to make the country and its people rich, has gradually attracted the attention of the state. At present, the plastic machinery industry in China is a diversified industry spanning the fields of machinery, light industry, textile, agriculture, chemical industry, architecture, national defense and more; and its development is accompanied by the development of chemical industry. As one of four pillar materials following steel, timber, and cement, plastic has been widely applied to agriculture, building materials, packing, mechanical electronics, automobiles, traffic, domestic appliances, petrochemical industry and national defense. At present, there are about 34,000 enterprises engaged in the plastic processing. Early in 1998, the annual output of plastic products in China was about 15 million tons, only after the U.S.A, ranked the second in the world; and the total output value of plastic products was about RMB 138 hundred million in China in the same year. According to the continuous 13-year statistics and analysis on the main economical index of the plastic machinery industry by Chinese Association of Plastic Machinery Industry and Machinery Industry Plastic Machinery Technical Information Network, the total output value of plastic machinery industry was RMB 2.1 hundred million in 1987 and RMB 38 hundred million in 1998, experiencing the dramatic increasing by about 20 times with annual increasing rate of above 7% that is much higher than that of other machinery industries. The tax revenue created by the plastic machinery industry to the state was more than RMB 45 million in 1989 and up to RMB 1.8 hundred million in 1998; the quantity of the employees in plastic machinery industry is always about 100 thousand. In view of that plastic and rubber both belong to high molecular compound materials, many plastic machinery factories produce rubber machinery and plastic machinery at the same time and some of them even have its own plastic product factory. In this way, they can create more values as well as provide customers with engineering demonstrations so as to promote product distribution, improve product performances, and upgrade product grade. The plastic mechanical product structure in China should be put into consideration from two aspects. One is form the aspect of macro-industry structure. In China, the low-technology-content plastic mechanical products are under a saturated, surplus state, while high precision, high efficient, and high-technology-content plastic mechanical products still require considerable investment and dramatic development. Today most of such advanced products have to be imported and those large, medium-scale state-owned enterprises that can be matchable to oversea enterprises have difficulty in taking a step in severe market competitions. Therefore, the state has to offer energetic supports in policy, especially in the policy of jointly developing products, so as to make full use of its resources advantages and accelerate the development of hi-tech products. The other is from the aspect of local industry structure. We should speed up the development and application of plastic mechanical products in the northwest and inland regions of China and then promote the economic development of the whole northwest and inland regions. With regard to the analysis on the plastic machinery market, it is impossible to make accurate statistics on its sales structure because the plastic mechanical products have a large quantity of kinds. Generally, the injecting machines are sold more in the south; plastic film equipment sets are distributed mainly in Shangdong, Hebei, and inland regions where water is in short supply; and manglers are distributed mainly in Foshan of Guangdong. Such sales structure, in fact, is related with the economic development level of China. The more developed the region is, the more the need for plastic machinery is, the higher the need for the product grade is, and the more diversified the need for the plastic machinery is. What's more, the users for plastic machinery always tend to spreading in the carpet way. As far as the plastic mechanical product export and import trade structure concerned, according to the statistics data of the "Chinese Plastic Machinery Brief News, the import value of plastic mechanical products per annum from 1996 to 1998 accounted for over 90% of the total import and export value while its export value accounted for less than 10%. Meanwhile, the statistics data also indicated that there was a downward trend in import of plastic machinery from 1996 to 1998. The import value in 1998 only accounted for 65.2% of the value in 1996, but the export value was almost the same, still about USD 0.46 hundred million. In reference to the market price of plastic machinery products, it is inevitable to suffer a price war among the ordinary plastic machinery because most mechanical enterprises except plastic machinery factories have little beneficial result now, that many manufacturer of machine tools and military products have tuned to the production of plastic machinery, and that the rising private plastic machinery factories have witnessed rapid development. Therefore, whoever has developed the new product first, he is capable of wining victory in such a price war. Each kind of new developed product has high additional value at the beginning, but its price will decline just within one year with the release of the similar products. Finally, it is quality that determines the price, and it is service that determines the users. In this way, there are mainly the competitions in quality and service in the future plastic machinery market. High price based on high quality is rational and high performance products also can bring considerable benefits to users. Plastic machinery market is aimed to offering plastic mechanical equipment for the plastic product processing industry. The output of plastic products in China was 9.994 million tons in 1995 and increased up to 15 million tons now. The per capita plastics consumption in China is 10 kg, much lower than the average per capita consumption level of 22 kg in the world. What's more, the per capita consumption of plastics in some advanced countries and regions has reached 50 to 100 kg. So China has a large potential market for plastic machinery. With the sustained development of the national economy, the consistent improvement of life quality of the people, and the continuous expansion of the application range of plastics, China sees the broad prospects for the development of the plastic industry. It is estimated that the output of plastic products can reach 16 million tons up to the year of 2000, 1.61 times as much as that in 1995, with the average increasing rate of 10% per year. According to the analysis on the plastic product market, China will witness that the output of plastic products will be increased by 7% per year on average from 2001 to 2010. It is estimated that output of plastic products in 2005 and 2010 will be 22.5 million tons and 32 million tons respectively. Up to year of 2010, the per capita of consumption of plastics in China will be up to 22.8 kg, equal to the average per capital plastic consumption level in the world. According to the market analysis for plastic products, the Chinese market capacity for plastic machinery through our making full use of the original production capacity will witness the increase by 6% per year on average from 2001 to 2010, which is estimated to be RMB 80 hundred million, 110 hundred million and 145 hundred million in 2000, 2005 and 2010 respectively. With the improvement of product quality and expansion of product range, China is witnessing the increase of domestic market shares for plastic machinery with the market share estimated to be 70%, 75% and 80% in 2000, 2005, and 2010 respectively. With the increase of export of plastic products, it is estimated that the total output value of the plastic machinery in China will reach RMB 96 hundred million and 140 hundred million in 2005 and 2010 respectively. The plastic machinery output value in 2010 is 2.33 times as much as that in 2000 with the average increasing rate of 9% per year. From 2001 to 2005, the average increasing rate is 10%; while from 2006 to 2010, the average increasing rate is 8%. As for the quantity of plastic mechanical products, it is estimated that plastic machinery output will be 55,000 sets/ 130,000 tons, 75,000 sets/ 190,000 tons, and 100,000 sets/ 270,000 tons in 2000, 2005, and 2010 respectively. Among them, the injection molding machines account for 35%, extrusion machines for 25%, hollow molding machines for 5%, and other machines for 35%. According to the "Plastic Machinery Collection", the sales volume of the top 10 enterprises in plastic machinery industrial in 1998 was RMB 15.04 hundred million, 18.02 hundred million, and 19.76 hundred million respectively; the market occupying rate of the then enterprises under statistics was 48.6%, 50.1%, and 55.9%; and the market occupying rate in the whole industry was 37.4%, 38.5%, and 43.0%. In view of the data mentioned above, the market-occupying rate of the top 10 enterprises in this industry is gradually increasing. The joint ventures in this industry, though small in quantity, have powerful competitive strength. The industrial total output value of joint ventures accounts for over 30% in the whole industry. What's more, there are 5 to 6 joint ventures among these top 10 enterprises. Those enterprises affiliated to the original mechanical industry are of weak strength with the industrial total output accounting for only about 20% in the whole industry. According to the Chinese Plastic Machinery Brief News, the annual export quantity of plastic mechanical products in China from 1996 to 1998 ranged from 4400 to 4900 (set), and the annual foreign exchange earned in the same years was about USD 46 million. In 1996, the foreign exchange earned through the export of plastic industry accounted for 9.6% of sales volume in this whole industry. Due to the financial crisis breaking out in 1997 in Asia, the profits in foreign exchanges witnessed a slight decrease in 1997 and 1998, which accounted for 8.0% and 8.1% of the total sales volume in the whole industry, respectively. In regard to the export quantity of plastic machinery, injection molding machines account for 60.4%, extrusion machines account for 6.8%, hollow molding machines account for 11.7%, and other plastic machines account for 21.1%. With regard to the profits in foreign exchanges, injection molding machines account for 74.1%, extrusion machines account for 8.1%, hollow molding machines account for 8.0%, and other plastic machines account for 9.8%. So it is easy to find that injection molding machines account for the largest rate among all plastic mechanical products made in China that are able to penetrate into the international markets. |
