Analysis of investment sensitivity in China's chemical fiber industry

1. Establishment background

In March 2020, the China Chemical Fiber Industry Association (hereinafter referred to as the "China Chemical Fiber Association") issued the "Investment Sensitivity Analysis of China Chemical Fiber Industry (2020 edition)" (hereinafter referred to as the "Investment Sensitivity Analysis"), aiming to guide enterprises and social capital to invest steadily and promote the high-quality development of the industry.

Since 2020, the internal and external environment of the development of China's chemical fiber industry has undergone great changes. In particular, since 2022, the operating pressure of China's chemical fiber industry has been prominent, the industry's start-up load has decreased significantly compared with previous years, and profits have been significantly reduced.

At present, the global economic growth is still facing more adverse factors, China's chemical fiber industry operation and development of the existing problems and risks need to be resolved, among which, the excessive growth of capacity in some industries is one of the key issues affecting the sustainable and stable operation and development of the industry.

In order to adapt to the new situation and new requirements, the China Chemical Fiber Association organized a revision of the "Investment Sensitivity Analysis (2020 edition)" to form the 2023 edition. This version is compiled according to the national industrial policies such as the Guidance Catalogue for Industrial Structure Adjustment (2019 edition), the Catalogue of Industries to Encourage Foreign Investment (2022 edition), and the relevant regulatory conditions of the chemical fiber industry, in combination with the actual situation of the current industry operation and development. In the future, China Chemical Fiber Association will continue to adjust and revise the "Investment Sensitivity Analysis" in a timely manner according to relevant national industrial policies, industry scientific and technological progress, market development and other factors.

The Investment Sensitivity Analysis indicates the existing or possible investment barriers or risks in the main fields of the chemical fiber industry. Enterprises should conduct sufficient scientific demonstration when launching new projects, and comprehensively consider the upstream and downstream supply and demand relationship, market competition, environmental protection requirements, international trade situation, market entry barriers, technological progress space and other factors. It is necessary to be more reasonable in the selection of technical equipment, product scheme design and industrial chain supporting layout, and prevent blind investment and low-level repetitive construction.

Second, analysis Angle

The investment sensitivity is analyzed according to the following four levels and twelve conditions. The more conditions met or the conditions met are distributed in different levels, the higher the investment sensitivity of the product. Vice versa, the lower.

(1) Market level

1. Phased excess has occurred or may occur in the short term.

2. Bulk conventional mainstream products.

3. The market capacity is limited, and the rapid increase of production capacity in the short term may lead to market imbalance.

4. There are alternative products or competing products.

5. It is greatly affected by the international trade environment.

(2) Environmental protection

6. Environmental protection requirements and energy consumption are greatly affected by relevant policies.

(3) Technical level

7. There are raw material bottlenecks, restricting the development of the industry.

8. There are technical barriers, key technical equipment is monopolized, and there is no reliable source.

9. The industry is in the early stage of development with large space for technological progress.

10. Insufficient application technology development; Or there are market barriers in high-end areas, and it is difficult to enter.

11. National defense, aerospace fibers.

(4) Fund level

12. There are capital barriers, high investment density, and asset-intensive heavy asset industries.

Note on "Investment Sensitivity Analysis of China's Chemical Fiber Industry (2023)"

In order to facilitate enterprises to better understand the content of the Investment Sensitivity Analysis of China Chemical Fiber Industry (2023 edition) (hereinafter referred to as the Investment Sensitivity Analysis), the following instructions are made.

First, the background of this revision

China's chemical fiber output has ranked first in the world since 1998, and production capacity has continued to grow. With the continuous promotion of industry transformation and upgrading and structural adjustment, the scale growth rate of chemical fiber industry has slowed down, during the 13th Five-Year Plan period, the average annual growth rate of chemical fiber production is 4.51%, which is 4.84 percentage points lower than the average annual growth rate of the 12th Five-Year Plan. However, from the perspective of production capacity increment, since the "14th Five-Year Plan", the production capacity of the chemical fiber industry has still maintained inertial growth, and some industries have made major breakthroughs in raw material bottlenecks or technical equipment, or due to the staged growth of demand in a certain field, resulting in rapid growth of its production capacity. According to the data of the National Bureau of Statistics, in the past two years, the fixed asset investment in the chemical fiber industry has maintained rapid growth, an increase of 31.8% in 2021, and an increase of 21.4% in 2022, although the investment in transformation and upgrading is included in the statistics, but this set of data also reflects the rapid growth of production capacity to a certain extent. From the demand side, there is no growth rate matching the supply side of the chemical fiber industry. Since 2020, the recovery of the world economy has faced strong risks and challenges due to multiple and complex factors such as repeated epidemics, geopolitical conflicts and high inflation. Although China's textile industry has benefited from the growth of global demand for epidemic prevention materials, the return of overseas orders and other factors, and exports have hit new highs, domestic demand growth is weak, and after a short recovery growth in 2021, the domestic market is obviously under pressure in 2022, and most industries in the textile industry chain show insufficient construction and declining profits. In 2022, the construction load of the chemical fiber industry has decreased significantly compared with previous years, and the production of chemical fiber has experienced negative growth for the first time in nearly four decades, and product inventories remain high.