Downstream work resumed well, and many major projects began construction.

Prices rebounded to a certain extent.

However, it is also important to be vigilant that with the arrival of the rainy season and busy farming season, the degree of demand improvement may vary.

From January to March 2023, the national cement production reached 402.34 million tons, a year-on-year increase of 4.1%
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Figure 1: High growth rate of infrastructure in the first quarter of 2023 Figure 2: Significant rebound in growth rate of railway and road transportation industry Data source: Cement big data（ https://data.ccement.com/ ）On the real estate development side, the completion of real estate development investment from January to March decreased by 5.8% year-on-year, with the completion of construction and installation projects decreasing by 11% year-on-year.

The growth rate continues to rebound and far exceeds the same period.

In addition, the cement production base during the same period was relatively low, resulting in an increase in cement production from January to March this year.

The decline in investment, especially in construction and installation projects, has dragged down the cement consumption.

Foot Mounted Anchor

The Spring Festival in 2023 was early, and the epidemic factors subsided.

The growth rate of infrastructure investment remains high at 8.8%, with the road transportation industry, which is closely related to cement demand, increasing by 8.5% and the railway transportation industry increasing by 17.6%.

At the same time, the physical workload has accelerated due to the recession of the epidemic, and the support of infrastructure for cement demand is strong.

At the same time, under the pressure of new production lines, the upward space of cement prices will be suppressed.

Looking ahead to the second quarter, with the continuous development of infrastructure projects and the gradual bottoming out and stabilization of real estate, demand is expected to continue to be released in the second quarter.

Affected by the decline in newly constructed area, the construction area also performed weakly, with a year-on-year decrease of 5.2% in the first quarter.

1、 Cement demand: the demand for infrastructure investment has picked up.

Although the benefits are expected to improve, the absolute profit level may still be relatively low.

In the first quarter, overall demand was better than the same period, and cement production increased.

From January to March 2023, the growth rate of fixed assets investment nationwide has slowed down to a certain extent by 5.1%.

On the construction side, the decline in newly constructed area is still significant, with a year-on-year decrease of 19.2% in the first quarter.

However, due to the low cement prices in this period and limited coal reduction, costs are still high, and it is expected that the profits of the cement industry will shrink significantly year-on-year.

Figure 3: Real estate development investment continues to bottom out Figure 4: New construction projects and weak construction area from January to March Data source: cement big data（ https://data.ccement.com/ ）Although real estate investment was still bottoming out in the first quarter, causing some drag on the increase in cement demand, infrastructure projects, especially transportation investments, continued to rebound and accelerated the formation of physical workload, which significantly boosted cement demand.