China Building Materials Industry

An Expert's View about Building Products and Construction in China

Posted on: 29 Mar 2010

China’s exports of building materials will continue to be geared primarily toward the Asia-Pacific region in 2009, a move that helped sustain sales last year as orders from the key markets ofthe EU and the US plummeted.


Customs statistics support this projection. In the first two months of 2009 alone, the Asia-Pacific absorbed nearly $1.6 billion worth of China made building materials to account for 50 percent of total sales during the period. Shipments consisted of doors, windows, tiles, flooring, insulation, construction panels and sheets, extrusions, wire netting and wallpaper.


Suppliers are optimistic that orders from the region will remain strong throughout 2009, thanks to the reinvigorated construction industries of certain countries.


In fact, higher government spending for public and civil engineering work has already helped propel South Korea to the top. Last year, the country procured nearly $860 million worth of building supplies from China to become the single-largest importer globally.


Another market offering strong opportunities for growth is India after the country received a $3 billion loan from the World Bank. The grant has been allocated for highway, rail, port and housing projects that are part of the national government’s eleventh five-year plan.


Amid this focus on the Asia-Pacific, suppliers are also exploring options in South and Central America and Africa.


The following are some of the keytrends we see in China’s building materials industry:

• Pricing strategies will vary due to current and projected growth threats. Suppliers planning to cut quotes in the next half-year will use the recent upswing on export tax rebates to help prevent price reductions from drastically eroding margins. Other companies, however,are poised to raise quotes as a way of protecting themselves against possible fluctuation in material costs.

• Product development efforts in the year ahead will target durability, aesthetics and environment alawareness. Companies plan to introduce improved surface treatments, additional shape and color options, and use materials that containless, or even zero, toxic substances.

• Anticipating continuous orders from the Asia-Pacific, many suppliers will raise capital expenditure in the coming year. Part of the funds will be invested in upgrades to boost manufacturing efficiency, which consequently, is expected to help control outlay.



The above is extracted from the Executive Summary of China Sourcing Report: Building Materials


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Posted: 29 March 2010

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