As the Spring Festival holiday comes to an end, the construction season for all walks of life is approaching. On the first working day, the seventh day of the first lunar month, the CPC Shandong Provincial Committee and the Provincial Government held a mobilization meeting for the major project of comprehensively advancing the conversion of old and new growth drivers in Shandong, igniting the "first fire" of the construction season. This year, Shandong will initiate the construction of a comprehensive pilot zone for the conversion of old and new growth drivers, and the Shandong Provincial Development and Reform Commission previously disclosed that 900 major projects with an estimated total investment of 4 trillion yuan have been planned and are ready.
In addition, the total planned investment for major projects this year in Henan, Jiangxi, Hubei, Fujian, Guizhou, Hebei and other places all exceeds one trillion yuan. Analysts believe that with the arrival of the construction season, cyclical commodities have also opened up room for imagination, and steel and coal prices are expected to be supported in the first half of this year.
Major projects drive Shandong's conversion of old and new growth drivers
On February 22, the CPC Shandong Provincial Committee and the Provincial Government held a mobilization meeting for the major project of comprehensively advancing the conversion of old and new growth drivers in Shandong. Liu Jiayi, Secretary of the Provincial Party Committee, stated at the meeting that efforts will be made to achieve new breakthroughs in making the "top ten" industries better, stronger, and larger.
Among the "top ten" industries, five are emerging industries: new-generation information technology, high-end equipment, new energy and new materials, smart ocean, and healthcare and wellness. The other five are industries formed through traditional transformation and upgrading: green chemicals, modern efficient agriculture, cultural creativity, boutique tourism, and modern finance.
Liu Jiayi said: "We must actively explore a transformation and upgrading path that combines stock reform and incremental rise, target these industries, follow up with supporting policies, and strive to make each industry a cluster with a scale of over one trillion yuan, first-class in the country, and even influential in the world."
On the same day, the Shandong Provincial Government also released the "Implementation Plan for the Major Project of Converting Old and New Growth Drivers in Shandong", comprehensively deploying the work of converting old and new growth drivers.
In early January this year, the State Council approved the "Overall Plan for the Construction of the Comprehensive Pilot Zone for the Conversion of Old and New Growth Drivers in Shandong". On January 30, the Shandong Provincial Government held a press conference to interpret the "Plan" and introduce the progress of the conversion work. Zhang Xinwen, Director of the Shandong Provincial Development and Reform Commission, said at the press conference: "The core of advancing the conversion of old and new growth drivers lies in industries, and the key lies in projects."
He introduced that since April last year, when Shandong began drafting the pilot zone plan, it simultaneously launched the construction of a major project library. After nine months of careful planning and screening, 900 major projects for the conversion of old and new growth drivers have been included in the library, with an estimated total investment of 4 trillion yuan.
Among some of the major projects in the library, the "presence" of A-share listed companies can also be seen. For example, Sinotruk's MC engine intelligent manufacturing project, Yantai Wanhua's 1 million tons/year ethylene integration project, and Weichai Power's hydrogen fuel cell manufacturing base project.
Multiple provinces have major project investment scales exceeding one trillion yuan this year
As the construction season approaches, it is expected that various regions will successively start construction of a batch of major projects.
A review by the reporter found that the total planned investment for major projects this year in Henan, Jiangxi, Hubei, Fujian, Guizhou, Hebei and other places all exceeds one trillion yuan.
From the specific arrangements, infrastructure construction such as transportation, energy, and water conservancy remains the investment focus in various regions. For example, Guizhou Province proposed that this year's fixed asset investment will be completed at around 1.6 trillion yuan, of which transportation, water conservancy, energy, and power grids will invest 200 billion yuan, 27 billion yuan, 62 billion yuan, and 12 billion yuan respectively.
However, this year's key project construction in various regions pays more attention to areas such as poverty alleviation and ecological environmental protection.
For example, Gansu Province has determined 165 provincial major construction projects this year, with a total investment of 849.7 billion yuan. Gansu Province stated that compared with previous years, this year's key projects in three areas are more prominent: poverty alleviation, ecological environmental protection, and technological innovation. Among them, in the field of poverty alleviation, the focus is mainly on relocation for poverty alleviation, photovoltaic poverty alleviation, and rural power grid transformation.
Construction season opens up room for imagination for cyclical commodities
"The earlier the construction time recovers, the more support steel prices will get." He Hangsheng, editor-in-chief of the Steel Branch of SunSirs, said in an interview with the reporter that steel mills will still likely reap substantial profits this year.
Jing Chuan, chief economist of Zhongda Futures, also told the reporter that the main feature of cyclical industries is their strong correlation with domestic economic fluctuations. Steel and coal, as bulk raw materials, are often highly correlated with real estate and infrastructure in the national economy. In the new year, policies such as steel and coal capacity reduction and capacity replacement will continue, opportunities for supply-demand mismatch will still exist, and prices will therefore be supported again.
To do a good job, one must first sharpen one's tools. Before the construction season arrives, excavator sales have already shown signs of booming.
Recently, various brands of excavators are holding promotional exhibitions, and orders are very good, especially for medium and large excavators. Users who order medium and large excavators usually have relatively certain projects in hand. It is preliminarily estimated that the year-on-year increase in excavator sales in March may be between 30% and 50%, that is, sales of 27,000 to 30,000 units that month, and there is a possibility of further significant upward revision of expectations.
Some market participants told the reporter that most current excavator orders are for equipment replacement, and some are new additions. Judging from excavator procurement data, the construction situation in the first half of the year is worth looking forward to.