Aug 29, 2020
China's medium and high voltage inverter market remains declining in 2020
In the first three quarters of 2020, China's medium and high voltage inverter market continued to operate at a low level, and the demand for new projects in traditional industries continued to be sluggish. Throughout the whole year of 2020, the shrinkage of China's medium and high voltage inverter market has further increased year-on-year, and the market has entered a post-mature period. Gongkong predicts that the ASI index of the medium and high voltage inverter market in 2020 will be lower than 90 ((AutomationSales Index, automation supplier shipment index) = automation supplier's current quarter (current year) shipments year-on-year *100).
In the first three quarters of 2020, the domestic economy is under pressure to decline. Project-oriented market trends such as power, metallurgy, and mining where medium and high voltage inverters are mainly used continue to be sluggish, and the demand for medium and high voltage inverters in municipal and other energy-related industries is also falling. The trend has a certain impact on the overall market for medium and high voltage inverters.
Mines: Due to the adjustment of energy structure and capacity structure, the mining industry is facing capacity integration. The iron ore and non-ferrous metal mining industries have performed better than the coal industry. However, because the coal industry is the main application industry for medium and high voltage inverters, there are fewer new projects. The renovation project has also entered a bottleneck period. In recent years, the market size of medium and high voltage inverters in the mining industry has shrunk significantly year-on-year.
Metallurgy: Due to the shrinking investment and industrial restructuring, new projects have dropped significantly. Existing projects are mainly concentrated in steel plant relocation, energy saving and environmental protection renovation projects. In the first three quarters of 2020, the market size of medium and high voltage inverters in the metallurgical industry has shrunk significantly year-on-year.
Electricity: Due to the adjustment of the energy structure, thermal power has stabilized, nuclear power and hydropower investment has increased, and in the thermal power industry where high-voltage inverters are mainly used, projects are mainly concentrated in self-provided power plants and power plant transformation projects. Although the number of power plant feed water pump renovation projects has increased, they are not enough to change the overall industry changes. In the first three quarters, the market scale of medium and high voltage frequency converters in the power industry declined slightly year-on-year.
Oil, natural gas and petrochemical: Due to the adjustment of national energy strategy, oil and gas and petrochemical project delays are more common.
Chemical industry: International crude oil prices fluctuate, and the number of coal chemical projects started to decrease due to cost issues. There are certain market opportunities for small and medium-sized fine chemical projects, and basic chemical projects are still hovering at a low level.
Building materials: Due to production capacity control, projects are mainly concentrated in energy conservation and environmental protection renovation projects, with fewer new projects.
Water industry: Infrastructure investment remained stable, and water supply and water treatment projects were mainly concentrated in second- and third-tier cities and desalination projects.
The industrial structure of the traditional heavy industry is still in a period of adjustment, and the market demand in the industrial sector is gradually approaching a new balance. In the next few years, new projects will continue to be sluggish, and renovation projects will occupy the mainstream. There will be no significant fluctuations in the market and will remain at a low level. gngkong believes that the downward trend of China's medium and high voltage inverter market will narrow in the next three years and will maintain an average annual shrinkage of 2%.