"In 2014, it is expected that the new capacity of cement (including the elimination of backward capacity) will grow at about 1.5% and demand will further improve even if demand slows down by 7.2%. UBS construction materials industry analyst Miye Zhou said in Shanghai on January 14, "Historically, the cement industry has the highest profit in 2011, with about 100 billion yuan in the beginning. It may return to this level in 2014. The big expectation behind it is to go to production capacity."

On May 23, the reporter learned that the national cement price continued to rise last week, the range was 0.57%. Moreover, in 2011, cement prices have generally crossed the 400 yuan/ton barrier, and the return of industrial value has become a foregone conclusion, with a good trend throughout the year.

"Last week's rise in cement prices was mainly reflected in Jiangxi, Chongqing and Fujian in power-limited areas, with prices rising by 20-30 yuan per ton in different areas." Industry analysts told reporters. In addition, due to the limited movie, the supply of cement is tight, and the prices of Jiangxi and Chongqing are rising; Fujian is a continuing rise.

In fact, the reporter learned that since May, the overall price of cement in China has been on the rise path, the overall price of the first half of the month rose by 2.99%. In the first five months, it is also an upward trend.

"From January to May, the national price of P.O 42.5 cement market was 420 yuan/ton, up 50 yuan/ton from 2010, up 13.60%. The highest increase was in East China, up 44.90%."Industry experts said, but the southwest, northwest than last year were in a decline.

Interestingly, for the first time in 2013, coal prices fell and cement prices rose in the cement industry. "That is to say, the main cost side is falling, and the profit margin is obviously rising." Last year, the profit of the whole cement industry was 80 billion yuan. Miyezhou believes that this is mainly due to the restriction of productivity growth. After integration, the industry concentration becomes higher and some irrational competition is avoided.

Jiangxi Wannianqing Cement Co., Ltd. (000789) and Anhui Conch Cement Co., Ltd. (600585) recently issued performance forecasts that the net profits of the shareholders of the two companies attributed to listed companies in 2013 increased by 110%-136% and 50% respectively over the previous year, with profits of about 400-450 million yuan and 9.45 billion yuan respectively. Conch Cement explained that in 2013, it mainly benefited from the steady growth of market demand and the reduction of new capacity in the industry, the further improvement of the supply and demand relationship in the cement industry, the steady growth of the company's product sales and the sustained rise in prices; in addition, the company's production costs decreased year on year due to the fall in coal prices in 2013.

Cement industry has always been one of the disaster areas with excess capacity. However, Miyezhou said that from 2012 and 2013, the actual growth rate of cement supply was lower than that of demand.

In addition, the government has begun to develop a new cement standard, which will be released before 30 June 2014. This will eliminate PC32.5 cement and replace it with PC42.5 cement standard."In this area, preliminary estimates are likely to bring about a 10% increase in clinker (one part of cement) demand. Overcapacity in this industry will basically collapse. In the second half or fourth quarter of 2014, the price of cement may rise beyond expectations." Miye Boat said.

But the steel industry, which is also a building material, is less fortunate. Miyezhou believes that the overall focus of iron and steel prices may continue to decline in 2014, the upstream raw material iron ore prices will gradually decline, and iron and steel will lose cost support.

Bai Zhongyi, head of UBS Asia-Pacific Metal/Mining Research, said the price trend of iron ore was related to the slowdown of production in China's huge steel industry. "If the slowdown is relatively fast, of course, the impact on iron ore is a little big. But this year's iron ore price is definitely lower than last year's, depending on the supply side.

The British Financial Times reported yesterday that iron ore prices are stable, but are still close to a five-month low due to market fears caused by weak demand from Chinese steel mills.