Advantages and Disadvantages of Stainless Pipe Industry Policy
Industrial stainless steel pipes are widely used in various industries, and different industries and application fields have great differences in the quality and performance requirements of steel pipes. Among them, the low-end market has low entry barriers, and some applications are used in the high-end industrial stainless steel pipe market under complex working conditions such as high temperature, high pressure, deep cold, high vacuum, strong corrosion, flammability, and explosion, especially in the petroleum and chemical industries. There are high industry barriers for industrial stainless steel pipes in industries such as natural gas, and power equipment manufacturing.
1. Favorable factors
(1) National industrial policies promote industry development
As a basic material in the industrial field, industrial stainless steel pipes are widely used in my country’s equipment manufacturing industry. The equipment manufacturing industry is a strategic industry that provides technical equipment for various industries in the national economy. It has a high degree of relevance to other industries and is an industry with intensive technology and capital. An important guarantee for upgrading and technological progress and a concentrated expression of the country’s comprehensive strength.
The “Industrial Structure Adjustment Guidance Catalogue (2011 Edition)” promulgated by the National Development and Reform Commission clearly stipulates “single-unit 600,000 kilowatts and above supercritical and ultra-supercritical unit power station construction”, “nuclear power station construction”, “crude oil, natural gas, liquefied natural gas, Areas where a large number of industrial stainless steel pipes are used, such as the storage and transportation of refined oil and pipeline transportation facilities and network construction, are listed as encouraged projects.
The “Guiding Catalogue for Independent Innovation of Major Technical Equipment (2012 Edition)” promulgated by the Ministry of Industry and Information Technology will include “nuclear power units”, “million-kilowatt ultra-supercritical thermal power units”, “million-ton-level ethylene installations”, and “oil and gas generators”. The independent innovation technology and equipment listed as key development such as pipeline equipment and large-scale natural gas liquefaction equipment will also promote the development of the industrial stainless steel pipe industry.
(2) Equipment localization policy provides development opportunities
In order to promote the independent innovation and industrial upgrading of my country’s equipment manufacturing industry, my country’s “Equipment Manufacturing Industry Adjustment and Revitalization Plan” clearly put forward the planning goal of stabilizing the domestic equipment domestic market satisfaction rate of about 70%. The relevant state departments are based on the above goals.
Developed and deployed plans for the localization of industrial stainless steel pipes for major equipment in related fields. Large-scale enterprise groups such as PetroChina and Sinopec have also established a localization equipment steering group to promote the application of domestically-made industrial stainless steel pipes in related industries. The stainless steel pipe industry provides an opportunity for development.
(3) The advancement of infrastructure construction drives industry demand
Infrastructure construction is one of the main driving forces of my country’s economic growth. With the development of my country’s urbanization and industrialization, and the continuous advancement of fixed asset investment, infrastructure construction will still be an important force to promote my country’s economic development. In industries such as power and energy, construction of key projects and key projects have started one after another, and the impact of the 2008 financial crisis and the 11-year European debt crisis has not been greatly affected. The steady growth of investment in fixed assets in the above-mentioned industries has led to a continuous increase in the demand for industrial stainless steel pipes.
2. Disadvantages
(1) Fierce competition in the low-end market and unreasonable industrial structure
There are many domestic stainless steel pipe manufacturing enterprises, large, medium, and small enterprises that coexist. At present, they have the ability to produce high corrosion resistance oil and gas pipes, LNG transmission pipes, ultra-supercritical power station boiler pipes, and nuclear equipment used in petrochemical, natural gas, and power equipment industries. The number of high-end industrial stainless steel pipe companies such as the use of pipes is relatively small, and most of the companies’ products are concentrated in the low-end market. The industry is highly competitive, with extensive production and operation, low-profit levels, and weak resistance to market risks. The above structural problems are not conducive to the continuous improvement of the overall competitiveness of the industry.
(2) Foreign companies in the high-end market have certain competitive advantages
Although the output, technology, and quality of my country’s industrial stainless steel pipe enterprises in the high-end market have improved rapidly, there is still a certain gap with some international excellent enterprises. After long-term accumulation, excellent foreign companies have certain advantages in applied materials, production technology, equipment, and testing.
These companies have monopolized the market segments of high-end industrial stainless steel pipes under special domestic conditions. With the rise of domestic enterprises, these international manufacturers have used their own cost and technological advantages to establish higher barriers to competition, making it more difficult for domestic enterprises to enter the high-end market, making it impossible for domestic enterprises to share the high profits of the high-end market, which is harmful to my country’s industry. The use of the stainless steel pipe industry to improve the technical level and product quality and increase profitability has had an adverse effect.