Oil And Gas Prices Rose, Chinese Plastic Industry Has Entered The High Cost Era

This year, crude oil prices rose led the decline in gross margin of the plastics industry

, which has been embodied in the first quarter. However, the industry relieved for decline in oil prices recently. The industry believes that, due to the decline in gross margin and demand is relatively stable, the plastic industry in the first half year of profit growth year-on-year is expected to slow down. At the same time, Chinese plastic industry has entered the high cost era in the environment of oil and gas resources price continues to climb, plastics companies will face many difficulties.

The first quarter of this year, the listed companies of the plastics industry achieve the total profit of 250 million yuan, while only 53.4 million yuan in same period of last year.

As of June 9, 18 companies have 10 plastic industry companies to disclose performance forecast in the first half year, among one of them losses, a slight increase of 4. Fosugufen expected to reserve loss, the first half year achieved profit of 50 million yuan -5500 million; Cangzhou Mingzhu expected an increase of no more than 30%; The XTC Lai Sing expected an increase of 30% -50%; Greater Southeast is expected to increase less than 50%; Triplett is expected to increase about 30%.

Industry insiders estimate that profit of whole plastic plate in the first half will increase year on year, but the growth rate compared to the first quarter will decline. Analyzed form sub-category, the future prospects for the development of the plastics industry and its sub-sectors is not consistent. One kind is higher technical level and downstream with broad prospects of enterprises; the other is a low technology, low barriers to entry, the highly competitive of sub-sectors.

The industry is generally optimistic about the modified plastics such as high-tech products. The modified plastic is the highest value-added products in the plastic products industry, foreign specialty wire and cable material of the wire and cable industry and low smoke zero halogen flame retardant materials can achieve 30% gross margin.

The modified plastics listed companies have Triplett, blonde science and technology etc, Triplett modified plastics basically used for car. Main role of automotive for plastic is to pull sales growth, 20% of the weight of the foreign automotive is modified plastics, but domestic proportion is 11%.

Because production of plastic should be from petroleum refining, the whole process needs to be high-cost and large investment. The experts believe that the rising costs cause the profitability of the domestic plastic enterprises become negligible.

by: loveboa

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