Technological innovation is expected to boost the development of the heavy machinery market

Core Tip: Outlook for Heavy Machinery Market The decline in industry prosperity is an inevitable manifestation of heavy machinery as a strong cyclical industry in the economic downturn stage. In 2014, investment demand in industries such as metallurgy, coal, and non-ferrous metals will remain sluggish, and there will be a need for replacement demand for heavy machinery products
Outlook for the Heavy Machinery Market
The decline in industry prosperity is an inevitable manifestation of heavy machinery as a strong cyclical industry during economic downturns. In 2014, investment demand in industries such as metallurgy, coal, and non-ferrous metals will remain sluggish, and the replacement demand for heavy machinery products will have a certain supporting effect, but to a limited extent. The prosperity of the heavy machinery industry will continue to operate at a low level. In terms of raw materials, it is expected that the possibility of steel prices rising in the short term is relatively small, which will provide some support for the overall operation of the industry, and the overall cost of the industry is controllable. Overall, the industry's operational risks will remain at a high level.
In terms of financial risk, it is expected that with the growth of fixed assets investment in the industry, the demand for external financing will rise, the scale of liabilities in the heavy machinery industry will continue to grow, and the industry's debt burden will still be at a high level. In addition, the downward trend of the industry's prosperity will reduce the revenue scale and profit growth, and the overall solvency of the heavy machinery industry will tend to decline, but still within a controllable range.
The trend of industry differentiation will continue in 2014. Compared to other heavy machinery products, mining machinery with the advantage of complete equipment supply capacity will have higher industry prosperity and profit margins, and relatively higher credit quality relying on its integrated solutions and procurement advantages; At the same time, heavy machinery enterprises with engineering contracting business are conducive to leveraging the synergies of the industrial chain, alleviating the impact of the decline in mechanical manufacturing business, improving risk resistance, and achieving better credit quality.
Overall, in the short term, the growth rate of industry demand tends to decline, and the negative impact of overcapacity on the supply and demand pattern of the industry will continue. The positive impact of low raw material prices on the industry is relatively limited, and it is expected that the industry's prosperity will remain low. The overall operating and financial situation of the industry is difficult to improve significantly, and China Bond Credit Rating maintains the industry evaluation of "poor" credit quality in the heavy machinery industry and the industry outlook of "stability".
Expected development direction
Li Jing, Executive Vice Chairman of the Heavy Machinery Association, believes that based on the above factors, heavy machinery enterprises should focus on efficient, durable, energy-saving and environmentally friendly heavy machinery products, carry out technological innovation, and can work from the following aspects to promote the overall competitiveness of the industry and boost the market.
Develop intelligent equipment. In the context of increasingly tight human resources, rising costs, and unstable product quality caused by human factors in China's heavy industry, there is a certain market space for developing intelligent products.
Research and develop new metallurgical process equipment. The innovation of metallurgical production processes and the advancement of metallurgical equipment mutually promote and develop. For example, the continuous casting process jointly promoted by the metallurgical and mechanical industries has greatly promoted the development of metallurgical technology in steel production.
To track metallurgical process research and develop new equipment. Metallurgical technology is constantly advancing and developing, such as smelting reduction ironmaking technology, short process rolling technology, etc. The emission reduction, disposal, and reuse of waste are constantly developing new processes. If industrialization matures, it may have a disruptive impact on the metallurgical industry. Equipment manufacturing enterprises should closely monitor the development trends of metallurgical science, actively cooperate with the research of process technology, participate in the development of intermediate and semi industrial experimental equipment in metallurgical research institutions, and gather strength for the development of metallurgical equipment manufacturing industry.
Develop energy-saving and emission reduction production unit equipment. In addition to conducting energy-saving and emission reduction research on host products, the heavy machinery industry also needs to increase the development of complete sets of emission reduction and resource recovery equipment for the collection and reuse of waste gas, waste liquid, and waste solids. For example, equipment integration and manufacturing in areas such as flue gas emission reduction, blast furnace and coke oven waste heat power generation, steel slag reuse, and wastewater recycling have broad markets, forming different forms of equipment manufacturing and environmental protection, energy recovery and utilization service formats.
It should be noted that the operation of these equipment also has problems with energy consumption, consumables, and capital consumption. The industry also needs to make great efforts to research and innovate new processes and equipment, forming new growth points for metallurgical equipment manufacturing.
Strive to improve existing products and ultimately achieve product upgrades through continuous improvement. Although we have made great progress in the design, assembly, and integration of the entire machine, key components such as reducers, bearings, hydraulic components, motors, electrical components, and automatic controls on the main engine are still equipped with foreign products. The localization of basic components requires the joint efforts of the main engine design, scientific research units, and user units to propose technical requirements and cooperate with component enterprises to carry out research and development on key components