Eileen Gu's  Instablog

The valves are devices used to make the medium (liquid, gas and powder) in the pipes or equipments flow, stop and enable to control the flow volumes, indispensable fluid control devices in the national economic departments, such as petroleum, chemical industry, power plants, long-distance pipelines, shipbuilding, nuclear industry, various low temperature engineering, space navigation and marine oil.

America is the largest valve provider in the world. According to the statistics from Manufacturers Standardization Society of the Valve and Fitting Industry, there are more than 110 valves enterprises with the annual output values exceeding 4 billion USD. With the intensification of the globalization of American enterprises, American valve enterprises begin to merge the local and other enterprises in the world so as to expand the market shares and strengthen the competitiveness. Due to the increasing acquisitions among the enterprises, American valve enterprises have been a part of some large multinational company.

In recent years, with the fiercer and fiercer competitions in the global valve market, many international outstanding valve manufacturers have closed down their factories in North America, Europe and Japan and shifted their factories to China, India, South Korea and Middle Europe with the purposes of cutting down the manufacturing costs and gaining more sales profits.

With the intensification of the exploitation and utilization of the oil and gas in China, Chinese valve market will be increased sharply, making most valve manufacturers set up the factories in China and the speed-up of the demands for the valves in China. Recently, China is striving to narrow the gap with the US. With several years of development, the number of the value enterprises in China stands the first place in the world, which is about 6000 large and small valve enterprises, enabling to provide 3,500 varieties in 40 thousand specifications. In 2008, the scale of Chinese valve market reached 7 billion USD. With the influences of international financial crisis, the growth speed of the valve market was cut down, but still up by 10% compared with 2007.it is predicted that China is expected to surpass America and become the largest valve market in the world in 2010.

From the aspect of the products, Chinese valve industry have had the ability of producing more than a dozen category products, such as gate valves, cut-off valves, ball valves, adjusting valves, safety valves, check valves, throttle valves, plug valves, pressure release valves, diaphragm valves, draining valves and emergency cut-off valves etc with the highest and lowest temperatures between 570℃ and -196℃, at the highest pressure of 600 Mpa and in the largest latus rectum of 5.35 thousand millimeters.

As a whole, mass high-end valves in the domestic market still depend on imports, and most domestic produced valves belong to low added value and labor-intensive products and few has the international advanced technical level. At present, various valves produced by Chinese manufacturers have the shortcomings of inner or external leak, inferior quality in the externals, short in performance, inflexible in operation and unreliable in the electric and pneumatic devices etc, partial; of which are only equivalent to the international level in the beginning of 1980s. Some valves, used in the high temperature or pressure devices or crucial devices need importing. Besides, there are still large gaps between Chinese and foreign valve industry in the fields of industry structures, industry chains and professional level.

The major reasons that cause Chinese local valves are in inferior quality lie in: sharp expansion of the market scale, weak in mass technical strengths, numerous small manufacturing enterprises in poor equipments, imitation products and short of corn technologies etc.

China needs to import more than 1 billion USD of the valves so as to meet the market demands. Taking transmitting the natural gas from the western areas to East China for example, mass valves used in the main lines are monopolized by the foreign funded enterprises. In the branch line bidding, only the local enterprises, including Chengdu Chengfeng Valve Co., Ltd and Zigong High Pressure Valve Co., Ltd win the bidding.

At present, Chinese valve market is rapid expansion and has huge market potential. First, the procurement amounts of the valves reach over 100 billion USD for China's South-North Water Diversion Project only from the suburb to the urban district about 70 kilometers, the whole length of which reach thousand of kilometers. The demands for the valves can be imagined. Besides, many other projects also have huge demands for the valves, such as the transmitting the natural gas from the western areas to East China, reforms of the old industrial bases, pipeline constructions in the cities, disposal of the polluted water and agricultural water conservancy constructions etc. there is a promising perspective for Chinese valve market, which attracts massive investors’ attentions at home and abroad.

More following information can be obtained in this report:

- Present Development Situation of Chinese Valve Industry

- Present Development Situation of the Sub-0products of Chinese Valves

- Overview on Chinese Valve industry Chains

- Factors affecting the Development of Chinese Valve Industry

- Major Local Enterprises and Their Operations of Chinese Valve Industry

- Distributions and Operations of the Foreign Funded Valve Enterprises

- Competition Situation of Chinese Valve Market

- Imports and Exports of Chinese Valve Industry

- Investment Opportunities in Chinese Valve Industry

- Prediction on the Development of Chinese Valve Industry

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China has become a major ship repair country through the rapid development of the 30 years. After the reform and opening-up, China’s ship industry began to be internationalized and Chinese enterprises received many foreign ship repair orders. More than 100 professional ship repair stations and paint bonded warehouses were established in such coastal provinces and cities as Shanghai, Guangzhou, Qingdao, Tianjin, etc. Thus, China’s ship repair industry became socialized and professionalized. At the same time, the scale of ship repair industry went larger. For example, the first 150,000 tons dock in China was built by Guangzhou Wenchong Shipyard Co., LTD and then the 300,000 tons dock was built by Shanhaiguan Shipyard. COSCO Shipyard and China Shipping International Shipyard Co., LTD even built a 300,000-ton floating dock. At present, the docking capacity has achieved 8 million tons and the capacity of large docks has exceeded that of Singapore.

The ship repair industry has developed rapidly these ten years. Nearly all varieties of ships can be repaired in China. In 2008, the sales revenues of the top ten ship repair enterprises reached RMB 25.47 billion (3.64 billion USD). The output value of COSCO Shipyard amounted to RMB 9.097 billion (1.3 billion USD), ranking the first. Its subsidiaries Dalian Shipping and Zhoushan Shipping, as well as Huarun Dadong Dockyard Co., LTD, China Shipping Industry Co., LTD, Chengxi Shipyard Co., LTD and Yiu Lian Dockyards (Shekou) Limited also achieved an output value of RMB 2 billion plus. The output value of the two ship groups, COSCO Shipyard and China Shipping Industry Co., LTD reached RMB 20 billion, accounting for 40 percent of the total volume.

Thanks to the abundant labor resources, low prices and increasingly advanced technologies, China is stepping toward the world ship repair center.

According to the statistics, China’s major ship repair enterprises repaired 5,310 ships in 2008, totaling 100 million DWT; more than 1,784 foreign ships were repaired, totaling 81.84 million DWT. The market size of ship repair industry in 2008 reached nearly 10 billion USD.

Since the second half of 2008, not only the ship building industry but also the ship repair industry has been severely affected by the global financial crisis. In 2009, both the output value and the number of ships repaired see a year-on-year slump of 30 percent.

Due to the flat market, declining demand and decreasing shipping volume, ship owners have no sufficient capital for ship repair and thus risks of abandoning ships and cancelling orders jump. There is also an apparent decrease in the amount of container ships arriving China’s ports because of the sudden slump of European and American sources. It is said that the amount of container ships arriving at China’s ports showed a year-on-year drop of 50 percent, which affected the number of foreign container ships repaired in China.

At the same time, China’s steel output is also strongly affected by financial crisis. Fewer foreign ore carriers come to China, which hinders the repair and refit of ore carriers.

Due to the difficulties for ship owners to borrow loans from bank, many orders are cancelled and some ship building enterprises even switch to ship repair, which contributes to a more fierce competition among China’s ship repair industry.

Moreover, after the financial crisis broke out, contracts of refitting about 10 monoshell VLCC into VLOC have been cancelled and some contracts of refitting have been terminated. Old ships are sold as scrap steel ships. The repair and refit of bulk cargo ships have also been delayed.

Though the crisis strongly affects the ship building industry and ship repair industry, the fluctuation of the repair industry is far less than that of ship building industry because a large number of ships need repairing and refitting throughout the world. Meanwhile, ship owners can take advantage of this gap to repair their ships which have been used for many years. Compared with the ship building and shipping industry, the ship repair industry behaves as a harbor under this crisis.

Severely affected by the financial crisis, the throughput of China’s containers represented a slump after October, 2008, as well as the import and output volume of iron ore. Some ship owners even suggested that the monoshell oil ships should be used until 2015 and some old ships should be disassembled, instead of repaired. However, the prospect of world ship repair market is still optimistic before 2015. At present, the world’s ship scale totals 1.1 billion DWT and these ships should be maintained and repaired at regular intervals. Some ships which are not well maintained during these brisk years will take a break and be repaired in this gap year in order to go on working in the next round.

According to IMO, monoshell oil tankers should be refitted into bivalve ones with double bottoms before 2010. Some developed countries, such as Europe, USA and Japan, do not allow the monoshell oil tanker into port after 2010. Refitting such oil tankers as Suezmax, Aframax and Panamax into bivalve ones with double bottoms will enrich the orders of ship repair enterprises. China has received a task of such refits of 100,000-ton Indian oil tankers.

As a newly emerging field, the repair of marine engineering equipment has become a new opportunity. Such projects as the construction of offshore oil drilling platforms, the repair of dredgers and crane ships, etc. have been regarded as hot markets by ship repair enterprises.

It is predicted that demand for ship repair will jump in 2009 and 2010, mainly because ship owner prefer to use the old ships instead of buying new ones. Meanwhile, the declining shipping orders also provide enough time for ship maintenance and repair. Some enterprises are unwilling to fire employees and thus ask them to do maintenance and repair working, which creates some opportunities for ship building enterprises.

The China’s ship repair industry will continue to take an advantageous position and the labor-intensive industry will be gradually replaced by the technology-intensive and capital-intensive industry within 10 to 20 years. These years, during which China’s ship repair industry will attract large amount of international and domestic capital, are called the “golden period” for China’s ship repair industry.

Readers can get more information as follows:

- Present situation of China’s ship repair industry

- Factors affecting the development of China’s ship repair industry

- Competition among China’s ship repair industry

- Major enterprises of China’s ship repair industry and their operation state

- Influences that global financial crisis has on China’s ship repair industry

- Development trend forecast of China’s ship repair industry

- Investment opportunities for China’s ship repair industry

To get more details, please visit www.shcri.com/reportde...